Marketing Management Module Revised

GLENN M.
DEMILLO, MBA
Compiler
IMERC COMMITTEE
Editor
SPAMAST STRATEGIC DIRECTIONS
i
SPAMAST - Marketing Management (EM 317) – AUGUST 2020
VISION
A premier competitive institution of higher learning providing

professional training in Education, Agri-Fisheries, Science and Technology,
Agri-business, Information Technology and other related disciplines geared
towards inclusive growth and development in the ASEAN Region and beyond.
MISSION
a rich culture of academic excellence and integrity through innovative

instruction, adaptive researches and sustainable extension and enhanced
resource generation while promoting environmental resilience, equity and
harmony in diversity.
BSAB OBJECTIVES
1. Articulate and discuss the latest developments in the specific field of

practice;
2. Effectively communicate orally and in writing using both English and
Filipino;
3. Work effectively and independently in multi-disciplinary and multi-
cultural teams;
4. Act in recognition of professional, social, and ethical responsibilities;
5. Preserve and promote “Filipino historical and cultural heritage ” (based
on RA 722), gender sensitivity and climate change.
6. Demonstrates corporate and social responsibility;
7. Implement the basic functions of management and marketing;
8. Use Information and Communication Technology (ICT) effectively and
efficiently;
9. Work well with others;
10. Use the proper decision tools to critically, analytically, and creatively
solve problems and drive results;
11. Understand and apply the concepts of agricultural productivity and
sustainability in the context of national, regional, and global
developments;
12. Engage in agricultural production and post-production activities; and
13. Promote sound agricultural technologies to various clients and in the
manpower development for agriculture;
INTRODUCTION
i
This module is designed in preparation for developing marketing plan.
Marketing is indeed an ancient art; it has been practiced in one form or the
other, since the days of Adam and Eve. Today, it has become the most vital
function in the world of business. Marketing is the business function that
identifies unfulfilled needs and wants, define and measures their magnitude,
determines which target market the organization can best serve, decides on
appropriate products, services and programs to serve these markets, and calls
upon everyone in the organization to think and serve the customer. Marketing
is the force that harnesses a nation's industrial capacity to meet the society's
material wants. It uplifts the standard of living of people in society.
Marketing must not be seen narrowly as the task of finding clever ways
to sell the company's products. Many people confuse marketing with some of
its sub functions, such as advertising and selling. Authentic marketing is not
the art of selling what you make but knowing what to make. It is the art of
identifying and understanding customer needs and creating solutions that
deliver satisfaction to the customers, profit to the producers, and benefits for
the stakeholders. Market leadership is gained by creating customer
satisfaction through product innovation, product quality, and customer
service. If these are absent, no amount of advertising, sales promotion, or
salesmanship can compensate.
William Davidow observed: 'While great devices are invented in the
laboratory, great products are invented in the marketing department'. Too
many wonderful laboratory products are greeted with yawns or laughs. The
job of marketers is to 'think customer' and to guide companies to develop
offers that are meaningful and attractive to target customers. Already sea
changes have been taking place in the global economy. Old business road
maps cannot be trusted. Companies are learning that it is hard to build a
reputation and easy to lose it. The companies that best satisfy their
customers will be the winners. It is the special responsibility of marketers to
understand the needs and wants of the market place and to help their
companies to translate them into solutions that win customers approval.
Today's smart companies are not merely looking for sales; they are investing
in long term, mutually satisfying customer relationships based on delivering
quality, service and value.
Above concepts of marketing management is just giving you an
excitement about this course. The confusions and misconceptions about
marketing were initially answered but inside of this module, you can learn
more.
SO, RELAX, THEN READ FIRST THE OVERVIEW OF THIS MODULE ON THE
NEXT PAGE.
OVERVIEW
i
Course Title:
Marketing Management (EM 317)
Course Description:
This course focuses on the analysis of marketing opportunities and
problems of various types of business endeavours with applications to
agribusiness enterprises, marketing, planning, strategy formulation,
implementation and control.
Course Outcomes:
At the end of the course, the students are able to:
1. Understand and explain the different marketing management
concepts and principles.
2. Apply concepts and principles learned in analyzing and presenting
cases.
3. Analyze markets and design marketing plans/ programs.
UNIT 1
MARKETING: AN INTRODUCTION
Most of us define marketing as selling or advertising. It is true that

these are parts of the marketing. But marketing is much more than
advertising and selling. In fact marketing comprises of a number of activities
which are interlinked and the decision in one area affects the decision in other
areas.
UNIT II
PRODUCT CONCEPT AND DECISIONS
A product is anything that can be offered to a market to satisfy a want

or need. Products that are marketed include physical goods, services,
experiences, events, persons, places, properties, organizations, information
and ideas.
UNIT III
STRATEGIC MARKETING PLANNING
Strategic planning is the management task concerned with the growth

and future of a business enterprise. Strategic planning can be viewed as a
stream of decisions and actions that lead to effective strategies and which, in
turn, help the firm achieve its growth objectives. The process involves a
thorough self-appraisal by the corporation, including an appraisal of the
businesses it is engaged in and the environment in which it operates.
INSTRUCTION TO THE USER
i
Have a Good day!
This module has intended learning objectives, pretest, discussion, and

posttest. The objectives of each lesson will be your basis what to be achieved.
Before studying and understanding our lesson, let us check first your knowledge by
answering the pre-test. Don’t be dismayed of low score in the pretest for it is just
evaluating your stock knowledge about our topics. Read and understand every
lesson because at the end, posttest is prepared to evaluate your learning
development after studying our topics. Enable for you to pass, you just need 50% of
total score, but aim perfect score for a higher grade. Every evaluation and lesson
test has its own instructions. Please follow instructions carefully especially in
submission of your output. For you to be guided about the grading system, here it is;
Quizzes 40%
Requirements 30%
Summative exams (Midterm and Final) 30%
TOTAL 100%
Final Grade:
Midterm 50%
Final Term 50%
TOTAL 100%
See below the grades transmutation table for 50% passing rate;
ACTUAL TRASMUTED ACTUAL TRASMUTED
EQUIVALENT REMARKS EQUIVALENT REMARKS
GRADE GRADE GRADE GRADE
74% BELO W IP 74% 87.00% 2.00 PASSED
50% 75.00% 3.00 PASSED 75% 87.00% 2.00 PASSED
51% 75.00% 3.00 PASSED 76% 88.00% 2.00 PASSED
52% 76.00% 3.00 PASSED 77% 88.00% 2.00 PASSED
53% 76.00% 3.00 PASSED 78% 89.00% 2.00 PASSED
54% 77.00% 3.00 PASSED 79% 89.00% 2.00 PASSED
55% 77.00% 3.00 PASSED 80% 90.00% 1.75 PASSED
56% 78.00% 2.75 PASSED 81% 90.00% 1.75 PASSED
57% 78.00% 2.75 PASSED 82% 91.00% 1.75 PASSED
58% 79.00% 2.75 PASSED 83% 91.00% 1.75 PASSED
59% 79.00% 2.75 PASSED 84% 92.00% 1.75 PASSED
60% 80.00% 2.75 PASSED 85% 92.00% 1.75 PASSED
61% 80.00% 2.75 PASSED 86% 93.00% 1.50 PASSED
62% 81.00% 2.50 PASSED 87% 93.00% 1.50 PASSED
63% 81.00% 2.50 PASSED 88% 94.00% 1.50 PASSED
64% 82.00% 2.50 PASSED 89% 94.00% 1.50 PASSED
65% 82.00% 2.50 PASSED 90% 95.00% 1.50 PASSED
66% 83.00% 2.50 PASSED 91% 95.00% 1.50 PASSED
67% 83.00% 2.50 PASSED 92% 96.00% 1.25 PASSED
68% 84.00% 2.25 PASSED 93% 96.00% 1.25 PASSED
69% 84.00% 2.25 PASSED 94% 97.00% 1.25 PASSED
70% 85.00% 2.25 PASSED 95% 97.00% 1.25 PASSED
71% 85.00% 2.25 PASSED 96% 98.00% 1.25 PASSED
72% 86.00% 2.25 PASSED 97% 98.00% 1.25 PASSED
73% 86.00% 2.25 PASSED 98% 99.00% 1.00 PASSED
99% 99.50% 1.00 PASSED
100% 100.00% 1.00 PASSED
Lastly, provide notebook for this subject. It would be served as your answer
sheet. Keep it for the future reference or use.
DON’T BE AFRAID OF FAILING SCORE BECAUSE THE MOST IMPORTANT IS YOU

CAN DO BETTER NEXT TIME.
TABLE OF CONTENTS
i
PAGE
SPAMAST STRATEGIC DIRECTIONS …………………………………………… ii

INTRODUCTION ……………………………………………………………………….. iii
OVERVIEW……………………………………………………………………………….. iv
INSTRUCTION TO THE USER……………………………………………………… v
TABLE OF CONTENTS………………………………………………………………… vi
UNIT I 1
Lesson 1: Market and marketing
Lesson 2: Target Markets and Segmentation
Lesson 3: Relationships and Networks
Lesson 4: The Concepts Of Product, Selling, And Marketing
Lesson 5: Marketing Mix
UNIT II
Lesson 1: Products Levels and Hierarchy
Lesson 2: Brands and Trademarks
Lesson 3: Packaging
Lesson 4: Product Life-cycle Marketing Strategies
UNIT III
Lesson 1: Strategic Planning
Lesson 2: The Marketing Plan
References ……………………………………………………………….
Appendices ………………………………………………………………
Syllabus ………………………………………………………………………………
UNIT 1
i
Most of us define marketing as selling or advertising. It is true that
these are parts of the marketing. But marketing is much more than
advertising and selling. In fact marketing comprises of a number of activities
which are interlinked and the decision in one area affects the decision in other
areas.
Let us start the lesson 1!
Lesson 1: MARKET and MARKETING
In this lesson we will discuss the market and marketing. At the end of the
topic you should be able to;
1. Define markets and marketing

2. Differentiate types of markets
3. Know the scope of marketing
4. Analyze nature of marketing
5. Evaluate importance of marketing
6. Illustrate core concepts of marketing
Time Frame: 1st to 3rd week of this semester
PRE-TEST
Just trust your stock knowledge. Please don’t take a quick look in the discussion for you to answer.
True or False: Read and understand the statement or question carefully. Write
“TRUE “if the statement is correct, otherwise “FALSE”. Write your final answer in
your notebook with heading ““Pretest: Unit I (Lesson 1)”” at the upper center of
your answer sheet, then write your name completely with course, year, and section
(e.i. Demillo, Glenn M.; BSAB/1/A). Submit your answer before or on of this week
through messenger or text or email or hard copy.
1 The term “market” originates from the Latin word “Marcatus” which means “a place
where business is conducted.”
2 Market is defined as a group of potential customers with similar needs or wants who
are willing to exchange something of value with sellers offering various goods and/or
services to satisfy those needs or wants.
3 In consumer market the consumers obtain what they need or want for their personal
or family consumption.
4 Finished products such as packaging machine and generators are under
Industrial/Business Market
5 In most of the countries central/federal, state or local governing bodies are the largest
buyers requiring and number of products and services.
6 The product manufacturers and service providers are moving in different countries to
sustain and increase their sales and profits
7 Marketing is the process of discovering and translating consumer needs and wants into
products and services, creating demand for these products and services and then in
turn expanding this demand.
8 Marketing is the business process by which products are matched with markets and
through which transfer of ownership are affected.
9 Marketing is a societal process by which individuals and groups obtain what they need
i
and want through creating, offering and freely exchanging products and services of
value with others.
10 Good is defined as something tangible that can be offered to market to satisfy a need
or want.
11 A service can be defined as any performance that one party can offer to another that is
essentially intangible and does not result in the ownership of anything.
12 A self centred company does not give any concern to the consumers and competitors.
13 Competitor oriented companies mainly focus on competitor’s activities, what the
competitors are doing and what they are likely to do in the near future are the major
areas of concern.
14 Customer oriented companies believes in satisfying the customers at any cost.
15 Market driven companies are concerned about customers as well as competitors.
16 Marketing is a dynamic activity because a number of variables keep changing.
17 Long term objective of marketing is profit maximization through customer satisfaction.
18 The satisfied customer is the company’s best advertisement because word of mouth
communication by the customer has more credibility than any other form of marketing
communication and he’ll recommend the company’s products/services to his friends
and relatives.
19 Marketing continuously identifies the needs and wants satisfying products or services
which can propel the people to do an extra to earn money which can be exchanged for
the desired products or services.
20 marketing provides employment to the people in various areas like in advertising
agency, in the company sales force, in the distributor’s sales force, in public relation
firms etc.
21 Marketing helps in stabilizing economic condition in the sense that marketing helps in
selling the products or services, which keeps the various organizations functioning and
gainful employment is available to the people.
22 Marketing sustains the company by bringing in profits.
23 Marketing is the source of new ideas.
24 Marketing provides direction for the future course
25 Marketing identifies those needs or wants which were not satisfied and helps in
developing the product or service which can satisfy those unmet needs or wants of the
people.
26 Marketing helps in popularizing the product or service which attracts the customers as
well as competitors towards that product or service categories.
27 Needs describe basic human requirements
28 Demands are wants for specific products backed by an ability to pay
29 Marketers do not create needs: Needs pre-exist marketers. Marketers, along with other
societal influences, influence wants.
30 A product is any offering that can satisfy a need or want.
31 The product or offering will be successful if it delivers value and satisfaction to the
target buyer.
32 Exchange, which is the core concept of marketing, involves obtaining a desired product
from someone by offering something in return
33 A transaction is a trade of values between two or more parties.
34 Marketing Management is the process of planning and executing the conception,
pricing, promotion, and distribution of ideas, goods, services to create exchanges that
satisfy individual and organizational goals.
35 A transaction differs from a transfer. In a transfer, A gives X to B but does not receive
anything tangible in return. Gifts, subsidies, and charitable contributions are all
transfers.
GREAT! YOU DID IT HONESTLY!
NOW, TURN TO NEXT PAGE. IT IS TIME FOR US TO DISCUSS.
LET US DISCUSS!
i
In order to understand the concept of marketing, firstly you must understand
what is “market”?
Market
 The term “market” originates from the Latin word “ Marcatus” which
means “a place where business is conducted.” A layman regards
market as a place where buyers and sellers personally interact and
finalize deals.
 According to Perreault and McCarthy, market is defined as a group of

potential customers with similar needs or wants who are willing to
exchange something of value with sellers offering various goods and/or
services to satisfy those needs or wants.
 There are different types of markets which deals with products

and/or services such as :
1. Consumer Market: In this market the consumers obtain what

they need or want for their personal or family consumption . This
market can be subdivided into two parts—
 Fast moving consumer goods market from where the
consumers buy the products like toothpaste, biscuits,
facial cream etc. and services like internet, transportation
etc.
 Durables market from where; the consumers buy the
products of longer life like motorcycles, cars, washing
machines etc. and services like insurance cover, fixed
deposits in the banks and non-banking financial
companies etc.
2. Industrial/Business Market: In this market, the industrial or

business buyers purchase products like;
 Raw materials (iron ore, coke, crude oil etc.),

 Components (wind-screen, tyres, picture tubes, micro-
processors etc),
 Finished products (packaging machine, generators etc.),
 Office supplies (computers, pens, paper etc.)
 Maintenance and repair items (grease, lubricating oil,
broom etc.).
i
3. Government Market: In most of the countries central/federal,
state or local governing bodies are the largest buyers requiring
and number of products and services.
4. Global Market: The world is rapidly moving towards borderless

society thanks to information revolution and the efforts of WTO
to lower the tariff and nontariff barriers. The product
manufacturers and service providers are moving in different
countries to sustain and increase their sales and profits.
Examples: from the developed countries (AT & T, McDonald’s, Ford Motors,
IBM, Sony, Citi Bank etc.); from developing countries (Aditya Vikram Birla
Group, Maruti-Suzuki, Infosys, IRCON etc.)
5. Non-profit Market: On one hand the society is making

progress in every field, on the other hand the number of
problems that it is facing are also increasing. Most of the people
don’t care for these problems due to variety of reasons such as
—lack of awareness, lack of time, selfish nature etc. So in order
to fill the void, the non-profit organizations came into being.
These organizations support a particular issue or a charity and
create awareness among the general public towards these
issues and try to obtain financial and non-financial support. For
example there are NGOs.
So, what is Marketing?
Numerous definitions were offered for marketing by different authors. Some

of the definitions are as follows:
1. Creation and delivery of a higher standard of living.

2. Marketing is the process that seeks to influence voluntary exchange
transactions between a customer and a marketer.
—William G. Zikmund and Michael d’Amico
3. Marketing is the process of discovering and translating consumer

needs and wants into products and services, creating demand for
these products and services and then in turn expanding this demand.
—H.L. Hansen.
4. Marketing is the business process by which products are matched with

markets and through which transfer of ownership are affected.
i
—Edward W. Cundiff
5. Marketing consists of the performance of business activities that direct

the flow of goods and services from producers or suppliers to
consumers or end-users.
—American Marketing Association
6. Marketing is a societal process by which individuals and groups obtain

what they need and want through creating, offering and freely
exchanging products and services of value with others.
—Philip Kotler
7. Marketing is the performance of activities that seek to accomplish an
organization’s objectives by anticipating customer or client needs and
directing the flow of need satisfying goods and services from producer
to customer or client.
—William D. Perreault and E. Jerome McCarthy
Let’s take a look at the last definition and try to interpret it;
1. Applies to profit and non-profit organizations

 This definition applies to both profit and non-profit
organizations. Profit is the objective for most business firms.
But other type of organizations may seek more members or
donations or acceptance of an idea.
2. More than just persuading customers
 Marketing is not just selling and advertising, as most of the
people thinks. In fact, the aim of marketing is to identify
customer’s needs and meet those needs so well that the
products almost “sell itself”.
3. Begins with customer needs
 Marketing should begin with potential customer needs–not with
production process. Marketing should try to anticipate needs
and then it should determine what goods and services are to be
developed
4. Does not do it alone
 It means that marketing by interpreting customer’s needs–
should provide direction for production activities accounting and
financial activities and research and development activities and
try to coordinate them.
5. Builds a relationship with the customer
i
 Marketing tries to identify and satisfy customer needs and
wants. Its activities do not end with the single sale but rather it
tries to develop a relationship with the customer. So that in the
future, when the customer has the same need again—or some
other need that the firm can meet—other sales will follow. The
long lasting relationship is beneficial to both the firm and the
customer.
Scope of Marketing
1. Goods—Good is defined as something tangible that can be offered to

market to satisfy a need or want. Physical goods constitute the bulk of
most countries production and marketing effort. Examples; (shampoo,
bread, ketchup, cigarettes, newspapers etc.)
2. Services - A service can be defined as any performance that one party
can offer to another that is essentially intangible and does not result in
the ownership of anything. Examples: work of hotels, airlines, banks,
insurance companies, transportation corporations etc. as well as
professionals like lawyers, doctors, teachers etc.
3. Experiences—By mixing several services and goods, one can create,
stage and market experiences . For example water parks, zoos,
museums etc. provide the experiences which are not the part of
routine life.
4. Events - There is a whole profession of event planners who work out
the details of an event and stage it. Examples: Olympics, company
anniversaries, sports events (Samsung Cup—India Pakistan Cricket
Series), artistic performances (Lata Mangeshkar live concert, Jagjit
Singh live concert), trade shows (International Book Fair at Pragati
Maidan, Automobile fair), award ceremonies (Filmfare awards, Screen
awards), beauty contests (Miss World, Miss Universe, Miss India, Miss
Chandigarh), model hunts (Gladrags Mega Model).
5. Persons—Celebrity marketing has become a major business. Example;
Star Magic, GMA Entertainment, Star Image.
6. Places—Places–cities, states, regions and whole nations—compete
actively to attract tourists, factories, company headquarters and new
residents.
7. Properties—Properties are intangible rights of ownership of either
real property (real estate) or financial property (share and debt
instruments). Properties are bought and sold, and this requires
marketing effort. Examples: Housing and share trading.
8. Organizations—Organizations actively work to build a strong,
favorable image in the mind of their publics. Examples: Universities
i
and colleges are trying to boost their image to compete successfully for
attracting the students by mentioning their accreditations level and
topnotchers in the advertisements and information brochures.
9. Information—Information can be produced and marketed as a
product. This is essentially what schools, colleges and universities
produce and distribute at a price to parents, students and
communities. Examples; Encyclopedias and most non-fiction books
market information.
What does it mean?
a. A self centred company does not give any concern to the

consumers and competitors. This type of company can exist in
the situation of monopoly. In the competitive economy, these
companies cannot remain in the business for long.
b. Competitor oriented companies mainly focus on competitor’s
activities, what the competitors are doing and what they are
likely to do in the near future are the major areas of concern.
The companies can be either reactive or proactive. The reactive
company will follow the moves of competitors. For example, if
the competitor reduce price of its product or service then the
reactive competitor oriented company will also reduce its prices.
Whereas the proactive competitor oriented company will try to
identify what its major competitor is going to do.
c. Customer oriented companies believes in satisfying the
customers at any cost. These companies obtain inputs from the
customers and then develop their product or service as per
customers requirements and then earn profit through-customer
satisfaction. The biggest problem is that they don’t consider
what their competitors are doing and in the long run it might
prove counter-productive.
d. Market driven companies are concerned about customers as well
as competitors. These companies regularly interact with the
customers to know about their satisfaction levels and their
future requirements and then try to develop the product or
i
service which is better than their competitors. In the era of cut
throat competition, these companies one more likely to be
successful than the other companies.
 Marketing is a dynamic activity because a number of variables keep

changing. For example marketing environment, customer’s
requirements, competitor’s actions etc. keep changing thereby
necessitating the changes in the company’s offer.
 Long term objective of marketing is profit maximization through

customer satisfaction. This is so because a satisfied customer will come
back again for the same or different need to the company. Apart from
this, the satisfied customer is the company’s best advertisement
because word of mouth communication by the customer has more
credibility than any other form of marketing communication and he’ll
recommend the company’s products/services to his friends and
relatives.
 Marketing is an integrated function and all the marketing decisions are

linked with each other. One decision will automatically lead to another
decision. For example if a company has decided to launch a product for
limited number of customers then its price will be high and that
product will be available through exclusive distribution system and the
promotion strategy will depend on the media preferred by the target
market. So, if a company decides the first step then decisions
regarding the remaining steps will follow automatically.
 Marketing is the core functional area of modern day organizations and

is the driving force behind every organization. Marketing provides the
vital input for corporate planning which in turn dictates the plans for
other functional areas.
 Marketing is interlinked with other functional areas of the organization .

Marketing people collects the information regarding (customer’s
requirements and pass it to) the research and development and
engineering people who‘ll turn the customer requirements into the
product or service features. The finance and accounts people help in
obtaining the money for the development of new product and also help
in arriving at the final price decision. The human resource department
provides the necessary manpower for carrying out various activities not
only in the marketing area but also in the other functional areas.
i
But why do we need marketing management? How important is it?
Importance of Marketing
1. To the Society
 It is instrumental in improving the living standards . Marketing
continuously identifies the needs and wants satisfying products
or services which can propel the people to do an extra to earn
money which can be exchanged for the desired products or
services. The people are likely to spend the additional income
over and above the disposable income on the products or
services which helps in minimizing the physical efforts. Thus,
marketing by indirectly increasing the earning ability will help in
improving the standard of living of the customers .
 Marketing generates gainful employment opportunities both

directly and indirectly.
o Directly, marketing provides employment to the people
in various areas like in advertising agency, in the
company sales force, in the distributor’s sales force, in
public relation firms etc.
o Indirectly, marketing is responsible for selling the
offerings of the organization. If the organization’s
products or services are able to satisfy the customers,
then customers will demand organization’s products or
services again and again, thereby sustaining the
production activities.
 Marketing helps in stabilizing economic condition in the sense

that marketing helps in selling the products or services, which
keeps the various organizations functioning and gainful
employment is available to the people. With the earnings from
the employment, the people will purchase the products and/or
services, thus sustaining the demand.
2. To the firms/companies
 Marketing sustains the company by bringing in profits .
Marketing is the only activity that brings revenue to the firm,
whereas other activities incur expenditure. If the company’s
products or services satisfy the customer’s requirements, then
the satisfied customers will keep the company in business by
repeat orders and recommending other profitable customers.
i
Thus marketing is the driving force behind a successful
company.
 Marketing is the source of new ideas. New product or service

ideas usually come from the research laboratories, employees or
from marketplace. It’s the marketing people who are in
continuous touch with the consumers and marketing
intermediaries. Interaction with them helps in identifying strong
and weak points of company’s product or services as well as
competitor’s products or services. This interaction can also help
in identifying unmet needs or wants of the consumers and the
features, consumers are looking into the products or services
which can satisfy those unmet needs or wants.
 Marketing provides direction for the future course. The

marketing oriented company continuously brings out new
product and service ideas which provide the direction for
corporate strategic planning for longer time horizon.
3. To the Consumers
 Meeting the unmet needs or wants. Marketing identifies those

needs or wants which were not satisfied and helps in developing
the product or service which can satisfy those unmet needs or
wants of the people. For example a number of drugs were
invented to treat various physical problems of the people. Again
the low cost formulations were developed to treat the people
who are unable to afford the expensive drugs.
 Reducing the price of products or services . Marketing helps in

popularizing the product or service which attracts the customers
as well as competitors towards that product or service
categories. Due to increase in demand, the manufacturing
capacity increase which brings down per unit fixed costs of the
product or service. Furthermore increase in competition led to
decrease in the prices charged by the firm. Thus the growing
demand and increasing competition both help in bringing down
the price of the product or service. For example price of both
mobile phone handset and mobile phone service are showing a
continuous downward trend thereby making the mobile phone
service affordable to more and more people.
i
Marketing can be further understood by defining several of its core concepts.
Let’s talk about it;
Core Concepts of Marketing
What does diagram tell all about?
Needs, Wants and Demands
 Needs describe basic human requirements . People need food, air,

water, clothing and shelter to survive. People also have strong needs
for recreation, education, and entertainment. These needs become
wants when they are directed to specific object that might satisfy the
need.
 Demands are wants for specific products backed by an ability to pay .
Many people want a big & beautiful house; only a few are able and
willing to buy one. Companies must measure not only how many
people want their product but also how many would actually be willing
and able to buy it.
These distinctions shed light on the frequent criticism that;
“Marketers create needs” or “marketers get people to buy things they

don’t want.” Marketers do not create needs: Needs pre-exist
marketers. Marketers, along with other societal influences, influence
wants.
Example: Marketers might promote the idea that a Mercedes would

satisfy a person’s need for social status. They do not, however, create
the need for social status.
Product or Offering
 A product is any offering that can satisfy a need or want . We

mentioned earlier the major types of basic offerings: goods, services,
experiences, events, persons, places, properties, organizations,
information, and ideas.
i
Example: A brand is an offering from a known source. A brand name
such as McDonald’s carries many associations in the minds of people:
hamburgers, fun, children, fast food, Golden Arches. These
associations make up the brand image. All companies strive to build
brand strength—that is, a strong, favourable brand image.
Value and Satisfaction
 The product or offering will be successful if it delivers value and

satisfaction to the target buyer. The buyer chooses between different
offerings on the basis of which is perceived to deliver the most value.
We define value as a ratio between what the customer gets and what
he gives. The customer gets benefits and assumes costs . The benefits
include functional benefits and emotional benefits. The costs include
monetary costs, time costs, energy costs, and psychic costs.
 The marketer can increase the value of the customer offering in

several ways :
o Raise benefits
o Reduce costs
o Raise benefits and reduce costs
o Raise benefits by more than the raise in costs
o Lower benefits by less than the reduction in costs
Exchange and Transactions
 Exchange, which is the core concept of marketing, involves obtaining a

desired product from someone by offering something in return. For
exchange potential to exist, five conditions must be satisfied :
1. There are at least two parties.
2. Each party has something that might be of value to the other
party.
3. Each party is capable of communication and delivery.
4. Each party is free to accept or reject the exchange offer
5. Each party believes it is appropriate or desirable to deal with the
other party.
 Exchange is a process rather than an event. Two parties are engaged
in exchange if they are negotiating—trying to arrive at mutually
agreeable terms. When an agreement is reached, we say that a
transaction takes place. A transaction is a trade of values between two
or more parties. This is a classic monetary transaction. But transactions
do not require money as one of the traded values.
i
 A transaction differs from a transfer . In a transfer, A gives X to B but
does not receive anything tangible in return. Gifts, subsidies, and
charitable contributions are all transfers.
From above discussion, we can define that;
Marketing Management is the process of planning and executing the

conception, pricing, promotion, and distribution of ideas, goods, services to
create exchanges that satisfy individual and organizational goals.
Apart from these core concepts there are additional concepts which will help
in understanding the marketing. These concepts will be discussed in lesson 2.
WOW, DID YOU LEARN? LET’S CHECK IT OUT.
TURN TO NEXT PAGE AND TAKE THE POST-TEST.
POST-TEST
Let us check how far you’ve got. Please don’t take a quick look in the discussion for you to answer.
i
Write your final answer in your notebook with heading “ Posttest: UNIT I
(Lesson 1)” at the upper center of your answer sheet, then write your name
completely with course, year, and section (e.i. Demillo, Glenn M.; BSAB/1/A).
Submit your answer before or on of this week through messenger or text or
email or hard copy.
IDENTIFICATION: Read and understand each statement. Identify what it

is about. 1 pt each
1 The term “market” originates from the Latin word “_____________” which
means “a place where business is conducted.”
2 It is defined as a group of potential customers with similar needs or wants who
are willing to exchange something of value with sellers offering various goods
and/or services to satisfy those needs or wants.
3 It is a market that the consumers obtain what they need or want for their
personal or family consumption.
4 Packaging machine and generators are example of what product.
5 The product manufacturers and service providers are moving in different
countries to sustain and increase their ______________.
6 It is the process of discovering and translating consumer needs and wants into
products and services, creating demand for these products and services and
then in turn expanding this demand.
7 It is the business process by which products are matched with markets and
through which transfer of ownership are affected.
8 It is a societal process by which individuals and groups obtain what they need
and want through creating, offering and freely exchanging products and
services of value with others.
9 It is defined as something tangible that can be offered to market to satisfy a
need or want.
10 It can be defined as any performance that one party can offer to another that is
essentially intangible and does not result in the ownership of anything.
11 A kind of company does not give any concern to the consumers and
competitors.
12 A kind of company mainly focus on competitor’s activities, what the competitors
are doing and what they are likely to do in the near future are the major areas
of concern.
13 A kind of company believes in satisfying the customers at any cost.
14 A kind of company is concerned about customers as well as competitors.
15 It is a dynamic activity because a number of variables keep changing.
16 It is a long term objective of marketing through customer satisfaction.
17 The satisfied customer is the company’s best advertisement because
________________ communication by the customer has more credibility than
any other form of marketing communication and he’ll recommend the
company’s products/services to his friends and relatives.
18 It continuously identifies the needs and wants satisfying products or services
which can propel the people to do an extra to earn money which can be
exchanged for the desired products or services.
19 It provides employment to the people in various areas like in advertising
agency, in the company sales force, in the distributor’s sales force, in public
i
relation firms etc.
20 It helps in stabilizing economic condition in the sense that marketing helps in
selling the products or services, which keeps the various organizations
functioning and gainful employment is available to the people.
21 It sustains the company by bringing in profits.
22 It is the source of new ideas.
23 It provides direction for the future course
24 It identifies those needs or wants which were not satisfied and helps in
developing the product or service which can satisfy those unmet needs or
wants of the people.
25 It helps in popularizing the product or service which attracts the customers as
well as competitors towards that product or service categories.
26 It describe basic human requirements
27 These are wants for specific products backed by an ability to pay
28 It is any offering that can satisfy a need or want.
29 The product or offering will be successful if it _________________ delivers to
the target buyer.
30 It involves obtaining a desired product from someone by offering something in
return
ESSAY: Discuss briefly and precisely. Do not copy what have been written in
this the discussion but your own understanding. 5 pts each
1. Interpret definition of markets and marketing

2. Differentiate types of markets
3. Know the scope of marketing
4. Analyze nature of marketing
5. Why marketing is important?
6. Illustrate and discuss core concepts of marketing
CONRATULATIONS! YOU HAVE FINISHED STUDYING LESSON 1!

Are you ready for the next lesson? If you are, turn to next page.
UNIT 1
i
Lesson 2: Target Markets and Segmentation
In this lesson we will discuss the Target Markets and Segmentation. At the
end of the topic you should be able to;
1. identify various types of market segmentation

2. know the beauty of target marketing
Time Frame: 4th week of this semester
PRE-TEST
True or False: Read and understand the statement or question carefully.

Write “TRUE “if the statement is correct, otherwise “FALSE”. Write your final
answer in your notebook with heading ““ Pretest: Unit I (Lesson 2)”” at the
upper center of your answer sheet, then write your name completely with
course, year, and section (e.i. Demillo, Glenn M.; BSAB/1/A). Submit your
answer before or on of this week through messenger or text or email or
hard copy.
1 Market segments can be identified by examining demographic, psychographic and
behavioral differences among buyers.
2 Demographic grouping is based on measurable statistics, such as gender, age, income
level, marital status, education, race, religion
3 Geographic segmentation involves segmenting the market based on location.
4 Psychographic segmentation is based on the premise that the choices people make
when purchasing goods and services reflect their lifestyle preferences or
socioeconomic class.
5 The beauty of target marketing is that aiming your marketing efforts at specific
groups of consumers makes the promotion, pricing, and distribution of your products
and/or services easier and more cost effective and provides a focus to all of your
marketing activities.
6 Upper class occupied Higher managerial, administrative, or professional
7 Lower middle class occupied Supervisory, clerical, junior managerial, administrative, or
professional
8 A liquor vendor, for instance, might want to target its marketing efforts based on the
results of Gallup polls, which indicate that beer is the beverage of choice for people
under the age of 54—particularly in the 18 to 34 range—whereas those aged 55 and
older prefer wine. In this case, liquor vendor segmented its market by age.
9 A lawn care service may want to focus its marketing efforts on a particular town or
subdivision inhabited by a high percentage of older residents. In this case, liquor
vendor segmented its market by neighborhood.
10 Working class occupied Unemployed, seasonal, or casual
GREAT! YOU DID ITLET

HONESTLY! IT IS TIME FOR US TO DISCUSS.
US DISCUSS!
i
Markets Segmentation
A marketer can rarely satisfy everyone in a market. Not

everyone likes the same soft drink, hotel room, restaurant, automobile,
college and movie. Therefore, marketers start with market
segmentation. They identify and profile distinct groups of buyers who
might prefer or require varying products and marketing mixes. Market
segments can be identified by examining demographic, psychographic
and behavioral differences among buyers. The firm then decides which
segments present the greatest opportunity— those needs the firm can
meet in a superior fashion.
 Demographic Segmentation
 Demographic grouping is based on measurable statistics,

such as:
 Gender
 Age
 Income level
 Marital status
 Education
 Race
 Religion
 It is usually the most important criterion for identifying

target markets, which means that knowledge of
demographic information is crucial for many businesses.
o Example; A liquor vendor, for instance,
might want to target its marketing efforts
based on the results of Gallup polls, which
indicate that beer is the beverage of choice
for people under the age of 54—particularly
in the 18 to 34 range—whereas those aged
55 and older prefer wine.
 Geographic Segmentation
 Geographic segmentation involves segmenting the

market based on location. Home addresses are one
example, but depending on the scope of your business,
you could also use:
 Neighborhood
 Postal or ZIP code
 Area code
 City
 Province or state
 Region
 Country (if your business is international)
i
 Example; a lawn care service may want to focus its
marketing efforts on a particular town or subdivision
inhabited by a high percentage of older residents.
 Psychographic Segmentation
 It divides the target market based on socioeconomic

class or lifestyle preferences. The socioeconomic scale
ranges from the affluent and highly educated at the top
to the uneducated and unskilled at the bottom. The UK-
based National Readership Survey segregates social class
into six categories:
Social
Social Status Occupation
Grade
Higher managerial, administrative, or
A Upper class
professional
Intermediate managerial, administrative, or
B Middle class
professional
Lower middle Supervisory, clerical, junior managerial,
C1
class administrative, or professional
Skilled working
C2 Skilled manual labor
class
D Working class Semi- and unskilled manual labor
E Subsistence class Unemployed, seasonal, or casual
 The lifestyle-preferences classification involves values,

beliefs, interests, and the like.
o Examples include people who prefer an urban
lifestyle as opposed to a rural or suburban
lifestyle, people who are pet lovers, or people with
a keen interest in environmental issues.
 Psychographic segmentation is based on the premise that
the choices people make when purchasing goods
and services reflect their lifestyle preferences or
socioeconomic class.
For each chosen target market, the firm develops a market

offering. The offering is positioned in the minds of the target buyers as
delivering some central benefit(s). For example, Volvo develops its cars
for the target market of buyers for whom automobile safety is a major
concern. Volvo, therefore, positions its car as the safest a customer
can buy. So what is the target market?
A. Target marketing
i
 It involves breaking a market into segments and then concentrating
your marketing efforts on one or a few key segments consisting of
the customers whose needs and desires most closely match your
product or service offerings. It can be the key to attracting new
business, increasing sales, and making your business a success.
 The beauty of target marketing is that aiming your marketing
efforts at specific groups of consumers makes the promotion,
pricing, and distribution of your products and/or services easier and
more cost effective and provides a focus to all of your marketing
activities.
 For Example,
o Suppose a catering business offers catering services in the
client’s home. Instead of advertising via a newspaper insert
that goes out to everyone, the caterer would first identify the
target market for its services. It could then target the
desired market with a direct mail campaign, flyer delivery in
a particular residential area, or a Facebook ad aimed at
customers in a specific area, thereby increasing its return on
investment in marketing and bringing in more customers.
WOW, DID YOU LEARN? LET’S CHECK IT OUT. TAKE THE POST-TEST.
POST-TEST
email or hard copy.

Write “TRUE “if the statement is correct, otherwise “FALSE”. 2 pts each.
1 Geographic segmentation involves segmenting the market based on

location.
2 Working class occupied Unemployed, seasonal, or casual
3 Psychographic segmentation is based on the premise that the choices
people make when purchasing goods and services reflect their lifestyle
preferences or socioeconomic class.
4 Upper class occupied Higher managerial, administrative, or professional
5 A lawn care service may want to focus its marketing efforts on a
i
particular town or subdivision inhabited by a high percentage of older
residents. In this case, liquor vendor segmented its market by
neighborhood.
6 Market segments can be identified by examining demographic,
psychographic and behavioral differences among buyers.
7 Lower middle class occupied Supervisory, clerical, junior managerial,
administrative, or professional
8 Demographic grouping is based on measurable statistics, such as
gender, age, income level, marital status, education, race, religion
9 The beauty of target marketing is that aiming your marketing efforts at
specific groups of consumers makes the promotion, pricing, and
distribution of your products and/or services easier and more cost
effective and provides a focus to all of your marketing activities.
10 A liquor vendor, for instance, might want to target its marketing efforts
based on the results of Gallup polls, which indicate that beer is the
beverage of choice for people under the age of 54—particularly in the
18 to 34 range—whereas those aged 55 and older prefer wine. In this
case, liquor vendor segmented its market by age.
ESSAY: Read and understand the case about and answer given question. 20 pts
Target Marketing Case Study: McDonald's
According to QSR magazine's 2017 QRS 50, McDonald's is the largest fast-food
chain in the U.S. ranked by sales. It's also one of the most successful examples of
demographic target marketing, aiming its products at children, teenagers, and young
urban-dwelling families by offering PlayPlaces & Parties, the Arch Card (reloadable
cash card), and free wifi, Happy Meals that include toys such as Marvel Studios
characters, special promotions, and clever ad campaigns. Targeted advertising
and aggressive pricing have enabled McDonald's to capture 17 percent of the fast-
food market share in the U.S. as of 2015.
However, as millennial surpassed baby boomers in 2016 to become the largest

generation in the U.S. workforce, McDonald's sales have been in decline as fast-food
style menu items, such as the ubiquitous Big Mac and fries, have less appeal to
millennial. In response, McDonald's has altered its marketing strategy to target the
millennial generation by advertising fresher, healthier menu options and upscale
coffee products such as espressos.
Who were the target markets of Mcdonalds and what market

segmentation have been used?

UNIT 1
i
Lesson 3: Relationships and Networks
In this lesson we will discuss the Relationships and Networks. At the end of
the topic you should be able to;
1. know the importance of marketing relationship

2. determine kinds of marketing channels
3. demonstrate the direct channel for consumer goods and services and
Channels of Distribution for Business-to-business Marketing
4. Understand the concept of supply chain
5. Analyze various types of competition
TIME FRAME: 5th to 6th week

PRE-TEST

hard copy.
1 Relationship marketing has the aim of building long-term mutually

satisfying relations with key parties
2 Relationship marketing builds strong economic, technical and social ties
among the parties.
3 Communication Channels include newspapers, magazines, radio,
television, mail, telephone, billboards, posters, fliers, CDs, audiotapes,
and the Internet.
4 Adding dialogue channels counterbalance the more normal monologue
channels (such as ads).
5 Selling channels include not only the distributors and retailers but also
the banks and insurance companies that facilitate transactions.
6 The direct channel is also familiar as the distribution method used by
many marketers of services and not for-profit groups that solicit
donations.
7 The manufacturer—retailer—consumers channel is commonly employed
when the retailer involved is a sizable organization.
8 The manufacturer—wholesaler—retailer—consumer channel of
distribution is the most commonly used structure for consumer goods.
This is because most consumer goods are so widely used.
9 The direct channel is the one most commonly used in the marketing of
organizational goods.
10 There is no distribution channel for organizational goods that directly
i
parallels the manufacturer—retailer channel.
11 The supply chain describes a longer channels stretching from raw
materials to components to final products that are carried to final
buyers.
12 Brand competition sees its competitors as other companies offering a
similar product and services to the same customers at similar prices.
13 Industry competition sees its competitors as all companies making the
same product or class of products.
14 Form competition sees its competitors as all companies manufacturing
products that supply the same service.
15 Generic competition sees its competitors as all companies that compete
for the same consumer rupees.
GREAT! YOU DID IT HONESTLY! IT IS TIME FOR US TO DISCUSS.
LET US DISCUSS!
Transaction marketing is part of a larger idea called relationship marketing.
 Relationship marketing has the aim of building long-term mutually

satisfying relations with key parties —customers, suppliers, distributors
—in order to earn and retain their long-term preference and business.
Marketers accomplish this by promising and delivering high quality
products and services at fair prices to the other parties over time.
 Relationship marketing builds strong economic, technical and social

ties among the parties. It cuts down on transaction costs and time. In
the most successful cases, transactions move from being negotiated
each time to being a matter of routine
 A marketing network consists of the company and its supporting

stakeholders (customers, employees, suppliers, distributors, retailers,
ad agencies, university scientists, and others) with whom it has built
mutually profitable business relationships. Increasingly, competition is
not between companies but rather between marketing networks, with
the prize going to the company that has built the better network. The
operating principle is simple; Build an effective network of
relationships with key stakeholders, and profits will follow.
Marketing Channels
i
To reach a target market, the marketer uses three kinds of marketing
channels.
1. Communication Channels to deliver and receive messages

from target buyers. They include newspapers, magazines, radio,
television, mail, telephone, billboards, posters, fliers, CDs,
audiotapes, and the Internet. Beyond these, communications
are conveyed by facial expressions and clothing, the look of
retail stores, and many other media.
2. Adding dialogue channels (e-mail and toll-free numbers) to
counterbalance the more normal monologue channels (such as
ads). The marketer uses distribution channels to display or
deliver the physical product or service(s) to the buyer or user.
There are physical distribution channels and service distribution
channels. They include warehouses, transportation vehicles, and
various trade channels such as distributors, wholesalers, and
retailers.
3. Selling channels to effect transactions with potential buyers.
Selling channels include not only the distributors and retailers
but also the banks and insurance companies that facilitate
transactions.
Marketers clearly face a design problem in choosing the best

mix of communication, distribution, and selling channels for
their offerings.
The Direct Channel for Consumer Goods and Services
 A good example of the direct channel is supplied by the neighborhood

bakery, which converts flour, water, and other raw materials into
baked goods and then retails these products, providing any other
functions that might be necessary to complete the transaction. The
direct channel is also familiar as the distribution method used by many
marketers of services and not for-profit groups that solicit donations.
See example diagram on the next page for direct channel;
i
Let’s talk it individually,
a. The Manufacturer (Producer)—Retailer—Consumer

Channel.
 The manufacturer—retailer—consumers channel is commonly
employed when the retailer involved is a sizable
organization, such as a discount chain like Wal-Mart. This
type of retail marketing organization may prefer to deal
directly with manufacturers to be able to order specially
made merchandise or obtain discounts or other benefits.
 Generally, the benefits must be important enough to make
the retailer willing to perform many wholesaling functions.
However, in an effort to please large retail customers, the
manufacturer may agree to perform wholesaler functions.
The efficiencies a manufacturer gains from the large orders
placed by Sears or Wal-Mart can more than offset the
wholesaling costs the manufacturer may have to absorb.
 Example: Most of the private mobile phone service provides
like Air Tel, Hutch, IDEA use service provider → Retailer →
Consumer channel to provide various pre-paid and post paid
service facilities to the consumers. This type of intensive
distribution helps in catering the customer requirements
anywhere, anytime.
b. The Manufacturer—Wholesaler—Retailer—Consumer
Channel.
 The manufacturer—wholesaler—retailer—consumer channel
of distribution is the most commonly used structure for
i
consumer goods. This is because most consumer goods are
so widely used.
 Example: It would be virtually impossible for the ITC, for
example, to deal individually with every retailer stocking
cigarettes, let alone every consumer of cigarettes.
 Thus, a long channel, with at least two intermediaries, is
needed to distribute the product. Wholesalers can also be
used in the distribution of services.
c. Channels That Include Agents.
 A familiar type of agent is the real estate agent. Consumers
marketing their homes or unconstructed plots often lack time
and marketing skills, so they hire agents.
 Manufacturers, especially those lacking expertise in
marketing a particular product line, may choose to permit
manufacturer’s agents or selling agents to handle the
marketing of their products. Such agents do not take title to
the goods they sell and usually earn commissions rather than
a salary.
 In marketing channels for consumer goods, agents may,
depending on the circumstances and the product they offer,
sell to retailers or wholesalers. The manufacturer-agent
wholesaler-retailer-consumer channel is widely used in the
marketing of consumer products, especially convenience
goods.
Channels of Distribution for Business-to-business Marketing
The name “business-to-business” suggests the importance of the

direct channel in the marketing of organizational products. Indeed, the
direct channel is the one most commonly used in the marketing of
organizational goods. Direct organizational sales of industrial machinery such
as escalators, power-generating machinery such as turbine engines, metals
such as titanium, and many other products require well-informed
salespersons, and perhaps engineers, who can help the buyer fit the product
into its organizational facility or manufacturing process.
a. The Manufacturer—Wholesaler—Organizational User

Channel
Because, by definition, retailers deal with consumers, there

is no distribution channel for organizational goods that directly
parallels the manufacturer—retailer channel. However, there is a
trade channel for organizational goods that relies on just one
i
wholesale intermediary, which performs a function much like that of
a retailer. This is the manufacturer distribution-organizational user
channel. See diagram below:
b. Manufacturer-agent or organizational user channel
It is commonly used in business-to-business marketing by

small manufacturers that market only one product to many users.
The wide range of customers to which agents sell suggests the
main attraction of agents for manufacturers flexibility.
One type of agent intermediary, the broker, can be used on

an occasional basis, as needed. No continuing relationship—and
therefore no continuing financial remuneration or other obligation—
is necessary. Similarly, manufacturers’ agents operate on a
commission basis within fixed geographic territories. Therefore,
they appeal to small organizations whose limited financial resources
make it difficult for them to fund their own sales forces.
Manufacturers’ agents are also attractive because they can be
employed in “thin” market areas or in foreign countries where
potential sales do not seem to justify a manufacturer’s forming its
own sales force. See diagram below:
i
Supply Chain
Whereas marketing channels connect the marketer to the target

buyers, the supply chain describes a longer channels stretching from
raw materials to components to final products that are carried to final
buyers.
Example: The supply chain for women’s purses starts with

hides, tanning operations, cutting operations, manufacturing, and the
marketing channels bringing products to customers.
The supply chain represents a value delivery system . Each

company captures only a certain percentage of the total value
generated by the supply chain. When a company acquires competitors
or moves up stream or downstream, its aim is to capture a higher
percentage of supply chain value.
Competition
Competition includes all the actual and potential rival offerings and
substitutes that a buyer might consider. We can broaden the picture further
by distinguishing four levels of competition, based on degree of product
substitutability: For example in the India,
1. Brand competition: A company sees its competitors as other

companies offering a similar product and services to the same
customers at similar prices. Maruti Zen might see its major
competitors as Tata Indica, Santro, and other manufacturers of
medium-price automobiles. It would not see itself as competing
with May bach or with Mahindra Scorpio.
2. Industry competition: A company sees its competitors as all
companies making the same product or class of products. Maruti
Zen would see itself as competing against all other automobile
manufacturers.
3. Form competition: A company sees its competitors as all
companies manufacturing products that supply the same
service. Maruti Zen would see itself competing against not only
other automobile manufacturers but also against manufacturers
of motorcycles, bicycles and trucks.
4. Generic competition: A company sees its competitors as all
companies that compete for the same consumer rupees. Maruti
Zen would see itself competing with companies that sell major
consumer durables, foreign vacations, and new homes.
i
POST-TEST
email or hard copy.
the discussion but your own understanding. 5 pts each
1. How importance is marketing relationship?

2. Differentiate kinds of marketing channels
3. Explain channels of distribution for Business-to-business Marketing
4. What is supply chain?
5. Among types of competition, which is better for you?
i
UNIT 1
Lesson 4: The Concepts of Product, Selling, and Marketing
In this lesson we will discuss The Concepts of Product, Selling, and Marketing.
At the end of the topic you should be able to;
1. Evaluate the product, selling, and marketing in persuading the

customers.
2. Differentiate selling and marketing concepts
3. Illustrate the selling and marketing concepts
TIME FRAME: 7th week of the semester
PRE-TEST

hard copy.
1 The product concept holds that consumers will favor those products
that offer the most quality, performance, or innovative features.
2 Better-mousetrap fallacy is the mistaken notion that if a company
produces a technically better product than its competitors it will be
more successful in the marketplace, believing that a better mouse-trap
will lead people to beat a path to its door.
3 The product concept can lead to marketing myopia, which is a short-
sighted and inward looking approach to marketing that focuses on the
needs of the company instead of defining the company and its products
in terms of the customers' needs and wants.
4 The Selling Concept holds that consumers and businesses, if left alone,
will ordinarily not buy enough of the organization’s products.
5 The marketing concept has been expressed in many colorful ways
6 Selling focuses on the needs of the seller; marketing on the needs of
the buyer.
7 Selling is preoccupied with the seller’s need to convert his product into
cash; marketing with the idea of satisfying the needs of the customer
by means of the product and the whole cluster of things associated with
creating, delivering and finally consuming it.
i
LET US DISCUSS!
The Product Concept
 The product concept holds that consumers will favor those products
that offer the most quality, performance, or innovative features.
 Managers in these organizations focus on making superior products
and improving them over time.
 They assume that buyers admire well-made products and can appraise
quality and performance. However, these managers are sometimes
caught up in a love affair with their product and do not realize what
the market needs.
 Management might commit the “better-mousetrap” fallacy, which is
the mistaken notion that if a company produces a technically better
product than its competitors it will be more successful in the
marketplace, believing that a better mouse-trap will lead people to
beat a path to its door.
 Product-oriented companies often design their products with little or no
customer input. They trust that their engineers can design exceptional
products. Very often they will not even examine competitors’ products.
 For example:
A General Motors executive said years ago: “How can the public know
what kind of car they want until they see what is available?” GM’s
designers and engineers would design the new car. Then
manufacturing would make it. The finance department would price it.
Finally, marketing and sales would try to sell it. No wonder the car
required such a hard sell! GM today asks customers what they value in
a car and includes marketing people in the very beginning stages of
design.
 The product concept can lead to marketing myopia, which is a
short-sighted and inward looking approach to marketing that focuses
on the needs of the company instead of defining the company and its
products in terms of the customers' needs and wants. It results in the
failure to see and adjust to the rapid changes in their markets.
o Examples;
 Railroad management through that travelers wanted
trains rather than transportation and overlooked the
growing competition from airlines, buses, trucks and
automobiles. That happened in America and is likely to
happen in India where middle class families are opting for
their own vehicle.
i
 Slide-rule manufacturers thought that engineers wanted
slide rules and overlooked the challenge of pocket
calculators.
 Colleges, departmental stores, and the post office will
assume that they are offering the public the right product
and wonder why their sales slip.
The Selling Concept
 It holds that consumers and businesses, if left alone, will ordinarily not
buy enough of the organization’s products. The organization must,
therefore, undertake an aggressive selling and promotion effort.
 It is practiced most aggressively with unsought goods, goods that
buyers normally do not think of buying, such as insurance etc. These
industries have perfected various sales techniques to locate prospects
and hard-sell them on their product’s benefits.
 It is also practiced in the non-profit area by fund-raisers, college
admissions offices, and political parties.
The Marketing Concept
 It holds that the key to achieving its organizational goals consists of

the company being more effective than competitors in creating,
delivering, and communicating customer value to its chosen target
markets.
 The marketing concept has been expressed in many colorful ways;
o Examples;
 “Have it your way.” (Burger King)
 “You’re the boss.” (United Airlines)
 “Putting people first.” (British Airways)
 “Partners for profit.” (Milliken and Company)
The Difference between Selling and Marketing
 Selling focuses on the needs of the seller ; marketing on the needs

of the buyer. Selling is preoccupied with the seller’s need to convert
his product into cash; marketing with the idea of satisfying the needs
of the customer by means of the product and the whole cluster of
things associated with creating, delivering and finally consuming it.
 Diagram below shows that the marketing concept rests on four pillars:
target market, customer needs, integrated marketing, and profitability .
Where they are contrasted with a selling orientation. The selling
concept takes an inside-out perspective. It starts with the factory,
focuses on existing products, and calls for heavy selling and promoting
i
to produce profitable sales. The marketing concept takes an outside-
in perspective. It starts with a well-defined market, focuses on
customer needs, coordinates all the activities that will affect customers,
and produces profits by satisfying customers.
WOW, DID YOU LEARN? LET’S CHECK IT OUT.
TURN TO NEXT PAGE AND TAKE THE POST-TEST.
i
POST-TEST
email or hard copy.
1. Differentiate selling concepts and marketing by discussing the diagram

below.
2. Read the passage below and explain how this become selling concept.
A political party vigorously “sells” its candidate to voters. The candidate

moves through voting precincts from early morning to late evening, shaking
hands, kissing babies, meeting donors, and making speeches. Countless
money is spent on radio and television advertising, posters, and mailings. The
candidate’s flaws are concealed from the public because the aim is to make
the sale, not worry about post purchase satisfaction. After the election, the
new official continues to take a sales-oriented view. There is little research
into what the public wants and a lot of selling to get the public to accept the
politician the party wants.
3. What is Better-mousetrap and marketing myopia?

i
UNIT 1
Lesson 5: Marketing Mix
In this lesson we will discuss the Marketing Mix. At the end of the topic you
should be able to;
1. Describe marketing mix

2. Explain marketing mix elements or the 4Ps
3. Know the channel of distribution under place as element
4. Determine various promotional activities
5. Understand the role of Price in marketing
TIME FRAME: 8th to 9th week of the semester
PRE-TEST

hard copy.
1 The marketing mix is the sole vehicle for creating and delivering
customer value.
2 The term product refers to what the business or non-profit organization
offers to its prospective customers or clients.
3 The offering may be a tangible good, such as a car
4 Place, or distribution, activities involve bridging the physical separation
between buyers and sellers to assure that products are available at the
right place.
5 A channel of distribution is the complete sequence of marketing
organizations involved in bringing a product from the producer to the
consumer.
6 Advertising, personal selling, publicity and sales promotion are all forms
of promotion.
7 A company uses advertising to inform, persuade or remind its target
market of its products or services.
8 Television advertising is the leading medium for reaching audiences.
9 The Internet has become an important electronic medium and its
interactive quality is unique. It permits immediacy of purchase and a
high level of convenience
10 Another trend in advertising is the infomercial. This is an extended
television advertisement and usually runs at off peak hours or on lower-
i
budget television or cable networks.
11 Sales promotion consists of many activities used to sell products. They
are activities that give consumers a short-term incentive to make a
purchase.
12 Consumer promotions are geared toward getting consumers to try a
company’s products.
13 Whether we cut coupons from newspapers and magazines or getting
them in the mail, coupons are a very popular form of sales promotion.
14 Sweepstakes and contests are another strategy of sales promotion.
15 Point-of-purchase (POP) promotional materials are displays that are set
up in stores in order to prominently display products.
16 Another strategy used by companies is that of special promotional items
to be given away.
17 price is what is exchanged for a product.
18 According to economists, prices are always, “on trial.” Pricing strategies
and decisions require establishing appropriate prices and carefully
monitoring the competitive marketplace.
LET US DISCUSS!
How is Marketing Mix actually accomplished?
If we turn to the nuts and bolts of this task, we can see that in the first
place, the marketer creates the product that will meet the identified needs of
the consumer. Second, he carries out functions such as transportation, so
that the product can conveniently reach the consumer . Third, he
communicates the benefits of the offer to the consumer by carrying out
various promotional activities such as personal selling, advertising and sales
promotion. Lastly, he tackles the price mechanism and consummates the
marketing task by arriving at a price that is acceptable to the consumer .
These are the elements with which the marketer accomplishes his value
delivering task.
The four elements mentioned above—product, distribution (Place),

promotion and pricing— constitute the marketing mix of the firm. The
marketing mix is the sole vehicle for creating and delivering customer value.
Note that the four Ps represent the sellers’ view of the marketing tools
available for influencing buyers. From a buyer’s point of view, each marketing
tool is designed to deliver a customer benefit. Robert Lauterborn suggested
that the sellers’ four Ps correspond to the customers’ four Cs.
i
The First Element—Product
 The term product refers to what the business or non-profit

organization offers to its prospective customers or clients. The offering
may be a tangible good, such as a car; a service, such as an insurance
plan; or an intangible idea, such as the importance of donating eyes
after the death.
 Product A good, service, or idea that offers a bundle of tangible and
intangible attributes to satisfy consumers of marketing, because they
can be controlled and manipulated by the market.
 Developing and planning a product involves making sure that it has the
characteristics and features customers want. Selecting a brand name,
designing a package, developing appropriate warranties and service
plans, and other product decisions are also part of developing the
“right” product.
The Second Element—Place
 Place, or distribution, activities involve bridging the physical separation

between buyers and sellers to assure that products are available at the
right place.
 Determining how goods get to the customer, how quickly, and in what
condition are decisions that are made to place products where and
when buyers want them.
 Transportation, storage, materials handling, and the like are physical
distribution activities.
 Selecting wholesalers and retailers or choosing to be an e-commerce
company operating exclusively on the Internet is decisions about the
structure and extent of distribution.
 For example, the Pepsi-Cola Corporation, which specializes in the
production and promotion of soft drinks, finds it efficient to utilize
independent bottlers and retailers to distribute its products to the
ultimate consumer.
i
 Channel of distribution: The sequence of marketing organizations
involved in bringing a product from the producer to the consumers.
o A channel of distribution is the complete sequence of
marketing organizations involved in bringing a product from the
producer to the consumer. Its purpose is to make possible
transfer of ownership and/or possession of the product.
o Basic channel of distribution consisting of the manufacturer,
the wholesaler, the retailer, and the ultimate consumer
The Third Element—Promotion
 It means by which marketers “talk to” existing customers and potential

buyers. Promotion may convey a message about the organization, a
product, or some other element of the marketing mix, such as the new
low price being offered during a sale period. Simply put, promotion is
marketing communication.
 Advertising, personal selling, publicity and sales promotion are all
forms of promotion. Each offers unique benefits, but all are forms of
communication that inform, remind, or persuade.
o For example, advertising that tells us “Thanda Matlab Coca-
Cola” or “Chhotta Coke” reminds us of our experiences with a
familiar cola. Or, when an IBM sales representative delivers a
personal message during a sales presentation, this personal
selling effort may be designed to explain how IBM’s experience
on the Internet and its computer servers help provide business
solutions. The essence of all promotion is communication aimed
at informing, reminding, or persuading potential buyers.
 Promotional or Advertising Schemes
i
Advertising is paid communication brought to audiences through
different forms of media such as television, radio, newspapers, magazines
and billboards. A company uses advertising to inform, persuade or remind its
target market of its products or services. Comparative advertising is used to
differentiate a company’s products in the marketplace from other similar
products. For example The “Pepsi Challenge” campaign was a form of
comparative advertising in which consumers were asked to take blind taste
tests to see if they could tell the difference between the products. Coca-Cola
uses reminder ads to show us how refreshing the beverage can be on a hot
day.
 Different Medium of Advertising and Sales Promotion
There are advantages and disadvantages to each media type and when
selecting the advertising mediums to use companies must understand who
their target audience is and which the most effective method for reaching
them is. Marketers must be able to divide their budgets among the various
media resources in order to stretch them the farthest to reach the most
customers.
1. Television
 Television advertising is the leading medium for reaching

audiences. Although a very expensive form of advertising, television
ads reach the largest percentage of the Indian population at once
and can be very appealing due to their visual nature as well as their
sound.
 TV ads can be classified into national, local, and cable

advertisements. The type of network chosen will depend on which
audience the marketer is trying to reach. If the advertisement is for
a local restaurant the company may choose to advertise only on
local stations or in local ad space on cable channels or national
networks. The time an advertisement is shown is also an important
decision that companies must make in order to reach the target
audience. Budgetary constraints will also be a factor in choosing
time slots for advertisements.
2. Print Advertisements
 Advertising in newspapers and magazines is another way of

reaching customers with a company’s message. Print ads are
effective because of their visual quality and can be run in many
different types of publications. Marketers selling products or
i
services to consumers may choose national publications such as
India Today or local newspapers such as the Times of India and
Hindustan Times. Businesses trying to sell products or services to
other businesses will often advertise in trade publications of the
industries they are trying to reach. Companies may also target
specialized publications for example a new computer product may
be advertised in PC World or another specialty technology
publication. Print ads have a longer life than electronic media ads
and are good for telling a story about the value of a product or
service.
3. Radio
 Although lacking the visual appeal radio can be an effective

medium for reaching target consumers. The average radio listener
tunes in for three hours a day and often on a regular basis. When
using radio advertisements in marketing mix it is necessary to make
sure that the company and product or service is clearly identified.
As with television it is also necessary to find the right station for
advertising to the target consumer. If your service is a bar for
college students you may choose to advertise in the evenings on a
college station or an alternative rock station and if your target
audience is senior citizens you may advertise on news stations or a
talk show.
4. Internet
 The Internet has become an important electronic medium and its

interactive quality is unique. It permits immediacy of purchase and
a high level of convenience. It can be personalized and
individualized. The Internet and the World Wide Web are becoming
essential tools in an integrated marketing plan and effective tools in
sustaining customer loyalty and satisfaction.
5. Direct Mail
 Mailing advertisements or promotions directly to people’s homes is

another commonly used method of reaching consumers. Direct mail
campaigns can be expensive due to printing and postage costs but
these campaigns can be effective if the mailings reach the right
consumers. Often companies will purchase lists of consumers or
collect data themselves to build a mailing list. The people on these
lists will then be sent targeted mailings.
i
6. Telemarketing
 The utilization of telemarketing has been greatly affected in India

by the recent implementation of the national “Do Not Call” registry,
where millions of Indians signed up to have their telephone
numbers removed from telemarketer lists. Internationally however
regulations regarding telemarketing vary and it may still be a very
effective method of reaching consumers. The downside of
telemarketing is that most people do not like the invasiveness of
being called at home though unfortunately many mass marketers
find the risk of offending non receptive households is offset by the
effective results and benefits from these marketing methods.
7. Outdoor and Out of Home
 The majority of outdoor advertising rupees are spent on billboards.

Billboards are a popular way of reaching commuters and consumers
in a single geographic location. Other forms of outdoor advertising
known as out of home include sports stadium ads, bus shelter
posters, or signage on buses and taxis.
8. Advertising Trends
 A very popular way of getting a message across is using celebrity

endorsements. Advertising companies are willing to pay money in
order to hire celebrities to represent their brands. Celebrities are
part of an advertising message and campaign. Of course using a
celebrity spokesperson can be a risk. When choosing a celebrity to
endorse products, it is important to find an appropriate match with
the product or service. The relationship should be believable. It is
also important that the celebrities endorsing the product be
credible. They should either have expertise in the field or be
trustworthy characters.
9. Sponsorships
 This is a well-used form of promotion and advertising that allows

the company to buy into a sporting event or activity. The amount of
investment in a sponsorship can range from an athletic company
supporting a college sports team by providing them with brand-
name uniforms in order to promote the brand to a company
sponsoring a cricket game. For example Pepsi and Coke use to take
sponsorship of cricket time to time.
10. Infomercials
i
 Another trend in advertising is the infomercial. This is an extended
television advertisement and usually runs at off peak hours or on
lower-budget television or cable networks. Infomercials are usually
at least a half hour long. Some of the most popular items that are
sold through infomercials are fitness videos, skin care products and
kitchenware. Often they will feature celebrity endorsements and
offer products that cannot be purchased in stores. Their low-budget
appearance and late-night showing often characterize infomercials.
Once the consumer is convinced to purchase the product he or she
will then be able to call and order the product over the telephone
generating a direct response to the infomercial.
11. Sales Promotion
 Sales promotion consists of many activities used to sell products.

They are activities that give consumers a short-term incentive to
make a purchase. Sales promotions are also activities that change
the price and value relationship of a product as perceived by the
target audience with the possible effect of generating immediate
sales. It is possible that a sales promotion can also alter the long
term value of the brand by making what might be a premium
product more affordable.
 Sales promotions are generally time-bound programs that require

participation on the part of the consumer through either immediate
purchase or some other action. The fundamental goals of sales
promotion are tactical, strategic and ultimate. The tactical goals are
to combat a competitor’s increase in market share to combat other
competitors’ promotional efforts and to move brands that are either
declining, overstocked, damaged or not selling fast enough. The
strategic goals are to motivate consumers to switch from a rival
brand to increase product consumption to reinforce the marketing
communications efforts for the brand and to motivatebrand loyalty.
The ultimate goal of a sales promotion is to increase sales, profits
and market share. There are different channels for sales
promotions which include consumer promotions and trade
promotions.
12. Consumer Promotions
 Consumer promotions are geared toward getting consumers to try a

company’s products. Some examples of consumer promotion activities
include coupons, rebates, sampling, sweepstakes, point-of-purchase
displays and special packs.
i
13. Coupons
 Whether we cut coupons from newspapers and magazines or getting

them in the mail, coupons are a very popular form of sales promotion.
They are very effective especially in economic downturns for luring
people into restaurants or causing them to make repeat purchases of
products. E-coupons are another popular form of sales promotion they
are extremely effective for luring in customers and are redeemed by 57
percent of the people who click on them. The most popular uses of e-
coupons are for sales of groceries, books and health and music
products. The disadvantage of coupons is that they do not encourage
brand loyalty most consumers who use coupons regularly are willing to
switch brands if there is a better discount available.
14. Rebates
15. Rebates are partial refunds that are offered by the manufacturers.
Often manufacturers will use mail-in rebates as incentives for
purchasing. The consumer must purchase the product at full price and
then fill out paperwork and mail in the receipt in order to receive some
money back.
 Companies will often send or hand out samples of products in order to

attract customers who may not have purchased their products
otherwise. Beverage companies may target college students and hand
out soft drinks on campuses, or a food company may set up a stand in
a grocery store so that consumers can sample their new chips. You
may even receive a trial bottle of shampoo in the mail or you may
remember receiving the India Online (IOL) CD in the mail offering 100
free hours of Internet access. These are all examples of sampling, and
the intention of these promotions is to introduce a new product or
service to a consumer in order to generate brand loyalty. Sampling can
be a costly method of attracting customers and it often results in
wasted distribution however it can be a very effective method for
getting consumers to switch brands.
16. Sweepstakes and Contests
 Sweepstakes and contests are another strategy of sales promotion.

Data will be collected from consumers and they will be entered to win
a prize. Companies can use the information that they collect from
entrants in order to develop a mailing list for future promotional
campaigns. Organizations must be sure to print all the guidelines for
their sweepstakes or contests in order to avoid legal entanglements.
i
Some of the guidelines companies should follow in order to put on a
successful sweepstakes promotion include the following:-
 Clarify who is eligible

 Indicate states where the promotion is not valid
 Declare the termination date of the promotion
 Clarify random drawing procedures
 Companies should also detail the prizes disclose the odds of
winning declare a deadline for entry and reserve the right to use
winners’ names and photographs for publicity.
17. Point-of-Purchase Displays
 Point-of-purchase (POP) promotional materials are displays that are

set up in stores in order to prominently display products. At a
grocery store a POP is usually placed in front of the store, at the
end of an aisle, in the aisle or on the shelf. POP displays are very
successful due to the fact that many people make last-minute
purchasing decisions.
18. Bundling
 Sometimes companies bundle products together in order to

promote a new product or to encourage consumers to try a
complementary product such as a free small conditioner bundled
with a shampoo purchase or a free disposable razor with a shaving
cream purchase. A company may also offer a bonus pack or a
special pack with 20 percent more in order to encourage a
customer to purchase a product.
19. Give a ways
o Another strategy used by companies is that of special

promotional items to be given away. These may be hats or
T-shirts advertising the company or brand. For example,
many times credit card
The Fourth Element—Price
 The money—or something else of value—given in exchange for

something is its price. In other words, price is what is exchanged for a
product. The customer typically buys a product with cash or credit, but
the price may be a good or service that is traded. In not-for-profit
situations, price may be expressed in terms of volunteered time or
effort, votes, or donations.
i
 Marketers must determine the best price for their products. To do so,
they must ascertain a product’s value, or what it is worth to
consumers. Once the value of a product is established, the marketer
knows what price to charge. However, because consumers’ evaluations
of a product are worth change over time, prices are subject to rapid
change.
 According to economists, prices are always, “on trial.” Pricing
strategies and decisions require establishing appropriate prices and
carefully monitoring the competitive marketplace.
POST-TEST
email or hard copy.
1. Describe marketing mix

2. Explain marketing mix elements or the 4Ps
3. Determine various promotional activities
4. What is the role of price in marketing
-END OF UNIT 1-
i
UNIT II
PRODUCT CONCEPT AND DECISIONS
A product is anything that can be offered to a market to satisfy a want

or need. Products that are marketed include physical goods, services,
experiences, events, persons, places, properties, organizations, information
and ideas.
Lesson 1: Products Levels and Hierarchy
Product Levels
 In planning its market offering, the marketer needs to think through

five levels of the product;
1. The most fundamental level is the core benefit: the
fundamental service or benefit that the customer is really
buying. Marketers must see themselves as benefit providers.
 Example: A hotel guest is buying “rest and sleep.” The
purchaser of a drill is buying “holes”.
2. The second level, the marketer has to turn the core benefit into
a basic product.
 Example: A hotel room includes a bed, bathroom, towels,
desk, dresser, and closet.
3. The third level, the marketer prepares an expected product, a
set of attributes and conditions buyers normally expect when
they purchase this product.
 Example: Hotel guests expect a clean bed, fresh towels,
working lamps, and a relative degree of quiet. Because
most hotels can meet this minimum expectation, the
traveler normally will settle for whichever hotel is most
convenient or least expensive.
4. The fourth level, the marketer prepares an augmented
product that exceeds customer expectations.
 Example: A hotel can include a remote-control television
set, fresh flowers, rapid check-in, express checkout and
fine dining and room service.
5. The fifth level stands the potential product, which
encompasses all the possible augmentations and
transformations the product might undergo in the future. Here is
where companies search for new ways to satisfy customers and
distinguish their offer.
i
 Example: All-suite hotels where the guest occupies a set of
rooms represent an innovative transformation of the
traditional hotel product.
Remember!
The new competition is not between what companies produce in their

factories, but between what they add to their factory output in the form of
packaging, services, advertising, customer advice, financing, delivery
arrangements, warehousing and other things that people value.
Product Hierarchy
Each product is related to certain other products. The product hierarchy

stretches from basic needs to particular items that satisfy those needs.
1. Need family: The core need that underlies the existence of a product
family. Example: security.
2. Product family: All the product classes that can satisfy a core need
with reasonable effectiveness. Example: savings and income.
3. Product class: A group of products within the product family
recognized as having a certain functional coherence. Example: financial
instruments.
4. Product line: A group of products within a product class that are
closely related because they perform a similar function, are sold to the
same customer groups, are marketed through the same channels, or
fall within given price ranges. Example: life insurance.
Lesson 2: Brands and Trademarks
Despite the common practice of speaking of brands, brand names, and

trademarks as if all these terms meant the same thing, there are some
technical differences among them.
 Brand : An identifying feature that distinguishes one product from

another; more specifically, any name, term, symbol, sign, or design or
a unifying combination of these.
 A brand is essentially a seller’s promise to deliver a specific set
of features, benefits, and services consistently to the buyers.
The best brands convey a warranty of quality. But a brand is an
even more complex symbol. It can convey up to six levels of
meaning:
1. Attributes: A brand brings to mind certain attributes.
i
 Example: Mercedes suggests expensive, well-built,
well-engineered, durable, high-prestige
automobiles.
2. Benefits: Attributes must be translated into functional and

emotional benefits.
 Example: The attribute “durable” could translate
into the functional benefit “I won’t have to buy
another car for several years.” The attribute
“expensive” translates into the emotional benefit
“The car makes me feel important and admired.”
3. Values: The brand also says something about the

producer’s values.
 Examples: Mercedes stands for high performance,
safety, and prestige.
4. Culture: The brand may represent a certain culture.

 Example: The Mercedes represents German
culture; organized efficient, high quality.
5. Personality: The brand can project a certain personality.

 Example: Mercedes may suggest a no-nonsense
boss (person), a reigning lion (animal), or an
austere palace (object).
6. User: The brand suggests the kind of consumer who buys

or uses the product.
 Example: We would expect to see a 55 year-old
top executive behind the wheel of a Mercedes, not
a 20-year-old secretary.
 Brand name: The verbal part of a brand—the part that can be spoken
or written.
 What Makes a “Good” Brand Name? See Characteristics of a
Good Brand Name below diagram;
i
 Brand mark : A unique symbol that is part of a brand.
 Trademarks: A brand or brand name can be almost anything a
marketer wants to be, but it does not have any legal status. A
trademark, on the other hand, is a legally protected brand name or
brand mark. The owners of trademarks have exclusive rights to their
use. Thus, the word trademark is a legally defined term. Either a brand
name is a registered trademark or it is not.
 Service Marks: Service marks provide the same identifying function
for services that trademarks provide for goods. Like brands, they can
be legally protected by registration. Service marks may also include
slogans like “Let’s make things better.”
 Generic Names: These generic names describe products or items in
terms that are part of our standard vocabulary— for example, flower
and food. Other words and terms, such as nylon, kerosene, escalator,
cellophane and formica, were originally invented to name particular
products but have become legally generic through common usage.
Brand-strategy Decision
A company has five choices when it comes to brand strategy.
1. Line Extensions. Line extensions consist of introducing additional

items in the same product category under the same brand name, such
as new flavor, forms, colors, added ingredients, and package sizes.
The vast majority of new-product introductions consist of line
extensions. See below Colgate Line-Extension;
i
 Advantages of Line Extension :
 Line extensions help strengthen brand power and keep
the brand live, modern and contemporary. Example; Surf
Ultra and Surf Excel help Surf remain modern and also
strengthen its claim as a major player in detergents.
 Changing consumer tastes can be accommodated
through line extensions. Every change in consumer tastes
may not warrant an altogether new brand.
 Usually, mounting advertising and promotion costs
necessitate a reduction in the brand portfolio of any firm.
Line extensions help the firm to contain its brand
portfolio.
 Line extensions provide a convenient route for infusing
new values into an ongoing brand and gaining presence
in new markets.
 Sometimes, companies add independent brands to a
product line, but later they find these brands cannot
stand independently and then they bring it under an
ongoing strong brand, i.e., they revert to line extensions.
Nestle, for example, first made Sunrise an independent
brand and later reverted it as a line extension of Nescafe
and called it Nescafe Sunrise.
2. Brand Extensions
 A company may use its existing brand name to launch new
products in other categories. Example; Honda uses its company
name to cover such different products as automobiles,
motorcycle, snow blowers, lawn mowers, marine engines, and
snowmobiles.
i
 Why Firms Opt for Brand Extension?
 Helps the new item to acquire instant brand recognition.
 Saves costs; a brand extension costs much less than
launching a new brand; today, for sheer economic
reasons, more and more firms are resorting to brand
extensions.
 Helps leverage the strength of the existing brand to new
additions within the line, within the category and outside
the category.
 When a brand lends for premium pricing, benefit of brand
extension is all the more significant.
 If an existing brand name can be extended across totally
new and unrelated categories of products, the benefit is
particularly large. It’s a tremendously less expensive way
of introducing new products.
 Extensions also help built the brand into a ‘super brand’
in the minds of consumers. It creates an extendable
brand canopy with high scope for profits.
3. Multibrands
 A company will often introduce additional brands in the same
product category. Sometimes the company is trying to establish
different features or appeal to different buying motives.
Example;, P&G produces nine different brands of detergents.
 A multibranding strategy also enables the company to lock up
more distributor shelf space and to protect its major brand by
setting up flanker brands. Example: Seiko establishes different
brand names for its higher-priced (Seiko Lasalle) and lower-
priced watches (Pulsar) to protect its flank. Sometimes the
i
company inherits different brand names in the process of
acquiring competitors.
 A major pitfall in introducing multibrand entries is that each
might obtain only a small market share, and none may be
particularly profitable.
4. New Brands.
 When a company launches products in a new category, it may
find that none of its current brand names are appropriate. If
Timex decides to make toothbrushes, it is not likely to call them
Timex toothbrushes.
5. Cobrands.
 A rising phenomenon is the emergence of cobranding ( also
called dual branding), in which two or more well-known brands
are combined in an offer. Each brand sponsor expects that the
other brand name will strengthen preference or purchase
intention.
 In the case of copackaged products, each brand hopes it might
be reaching a new audience by associating with the other
brand.
 Inspiring to read this example : Among the few component
branders that have succeeded in building a separate identity is
Intel. Intel’s consumer-directed brand compaign convinced
many personal computer buyers to buy only computer brands
with “Intel Inside”. As a result, major PC manufacturers—IBM,
Dell, Compaq—purchase their chips from Intel at a premium
price rather than buy equivalent chips from an unknown
supplier. Despite these success stories, most component
manufactures find it hard to convince buyers to insist on a
certain component, material, or ingredient in the final product.
Logo
 A brand name or company name written in a distinctive way; short for

logotype.
 Along with the brand name, companies also use a logo for visual
identification. Logo enhances recognition by the provision of a symbol
of identity. A logo is a pictorial symbol intended to communicate with
the consumers. It is an accompaniment to the brand name and the
two together identify a company’s product.
 Dos and Don’ts in Logo Selection
i
o The logo should fulfill the requirements of media suitability. It
has to be reproduced on various media like the print, television
and other electronic vehicles. It should also lend for attractive
reproduction on different surfaces like glass and plastics. It
should also have the flexibility to accommodate national/global
and business-to-business marketing contexts.
o The memory value of the logo is also very important. If one
attempts to pack everything into the logo, then people may not
remember anything. So, one has to be very choosy about the
features to be incorporated in the logo. The design must aid
memorability.
o Uniqueness is another aspect. The more exclusive the symbol,
the better the identification and response.
 Changing the Logo
o Though a logo is a relatively permanent entity for a company,
sometimes changes are warranted. And, companies do change
logos with the passage of time. They completely alter the logo
or modify it depending on the need.
o Example: Singer: The 150-year-old American company Singer
had the alphabet ‘S’ and the picture of a lady in bonnet using
the sewing machine as its logo. Almost a century later, this was
dropped; instead the name ‘Singer’ was adopted. The earlier
logo was more appropriate when the company was
manufacturing only sewing machines. After diversifying into a
variety of house-hold appliances, the company had to adopt a
new logo, relevant to the company’s altered range of products.
o Brand Name, Logo and Slogan
 The three go together; they must be compatible, one
reinforcing the other. Let us see a few examples.
i
Lesson 3: PACKAGING
Packaging is the part of product planning where a firm researches, designs,

and produces package(s). A package is a container used to protect, promote,
transport, and/or identify a product . It may consist of a product’s physical
container, an outer label, and/ or inserts.
a. The physical container may be a cardboard, metal, plastic, or

wooden box; a cellophane, wax paper, or cloth wrapper; a glass,
aluminum, or plastic jar or can; a paper bag; Styrofoam; some other
material; or a combination of these. Products may have more than one
container: Cereal is individually packaged in small boxes, with inner
wax paper wrapping, and shipped in large corrugated boxes; watches
are usually covered with cloth linings and shipped in plastic boxes.
b. The label indicates a product’s brand name, the company logo,
ingredients, promotional messages, inventory codes, and/or
instructions for use.
c. Inserts are (1) instructions and safety information placed in drug, toy,
and other packages or (2) coupons, prizes, or recipe booklets. They
are used as appropriate.
Packaging has become a potent marketing tool. Well-designed packages can

create convenience and promotional value. Various factors have contributed
to packaging’s growing use as a marketing tool :
a. Self-service : An increasing number of products are sold on a self-

service basis
 Given that 53 percent of all purchases are made on impulse, the
effective package operates as a “ five-second commercial.” The
package must perform many of the sales tasks: attract
attention, describe the product’s features, create consumer
confidence, and make a favorable overall impression.
b. Consumer affluence: Rising consumer affluence means consumers
are willing to pay a little more for the convenience, appearance,
dependability and prestige of better packages.
c. Company and brand image : Packages contribute to instant
recognition of the company or brand.
d. Innovation opportunity: Innovative packaging can bring large
benefits to consumers and profits to producers.
 Examples: Soft-soap cornered the market on pumps for
dispersing soap. Toothpaste pump dispensers have captured 12
i
percent of the toothpaste market because they are more
convenient and less messy.
Developing an effective package for a new product requires several

decisions;
1. Packaging Concept
 Defining what the package should basically be or do for the
particular product. Decisions must now be made on additional
elements—size, shape, materials, colour, text, and brand mark.
Decisions must be made on the amount of text, on cellophane
or other transparent films, on a plastic or a laminate tray, and
so on.
 The packaging elements must also be harmonized with decisions
on pricing, advertising, and other marketing elements.
2. Engineering tests
 conducted to ensure that the package stands up under normal
conditions
3. Visual tests
 to ensure that the script is legible and the colours harmonious
4. Dealer tests
 to ensure that dealers find the packages attractive and easy to
handle;
5. Consumer tests
 to ensure favourable consumer response.
Basic Packaging functions
The basic packaging functions are containment and protection, usage,

communication, segmentation, channel cooperation, and new-product
planning;
1. Containment and protection—Packaging enables liquid, granular

and other divisible products to be contained in a given quantity and
form. It protects a product while it is shipped, stored, and handled.
2. Usage—Packaging lets a product be easily used and re-stored. It may
even be reusable after a product is depleted. Packaging must also be
safe for all, from a young child to a senior.
3. Communication—Packaging communicates a brand image, provides
ingredients and directions, and displays the product. It is a major
promotion tool.
i
4. Segmentation—Packaging can be tailor-made for a specific market
group. If a firm offers two or more package shapes, sizes, colours, or
designs, it may employ differentiated marketing.
5. Channel cooperation—Packaging can address wholesaler and
retailer needs with regard to shipping, storing, promotion and so on.
6. New-product planning—New packaging can be a key innovation for
a firm and stimulate sales.
Package Materials
 Changing trends—from wood to paper and plastics : Over the

years a great deal of changes have taken place in the materials used
for packaging. In the earlier days, wood was the main material used. It
has slowly given place to paper and paperboard, especially on account
of the shortage in wood supplies. Paperboard cartons, paper bags and
corrugated boards have become popular forms of packaging for a
variety of products, from groceries to garments.
 Plastics, the new packing medium : With the growth of the

petrochemical industry; a new range of packaging materials have
entered the marketing scene. Films of low-density and high-density
polyethylene (LDPE and HDPE), metalized polyester film, metalized
polyester laminates and polypropylene have become the preferred
packaging medium for several products. In fact, such packaging
materials have to a large extent replaced the traditional medium of
paper, metal and jute.
i
Low Density Polyethylene (LDPE) High Density Polyethylene (HDPE)
Metalized Polyester Film Metalized Polyester Laminates
Polypropylene
 Tetrapacks : Tetrapacks or aseptic packaging is the new development

in food packaging. Here, the package as well as the contents are
sterilised and human handling dispensed with. The package consists of
several thin layers of polyethylene foil and paper. Several
manufacturers of fruit juices and fruit drinks are now using tetrapacks.
Tetrapacks have an edge over cans since their contents have a shelf
life of three months without the addition of preservatives.
Package Size and Convenience
i
Along with packaging aesthetics, package size and convenience also
contribute to the total product appeal.
Tubes
Nozzle Fractional packaging Reusable containers
Economy pack Sachets
i
Refill packs
Labeling
 Sellers must label products. The label may be a simple tag attached to
the product or an elaborately designed graphic that is part of the
package. The label might carry only the brand name or a great deal of
information. Even if the seller prefers a simple label, the law may
require additional information.
 Labels perform several functions.
1. First, the label identifies the product or brand—for instance, the

name Sunkist stamped on oranges.
2. The label might also grade the product; canned peaches are
grade labelled A, B and C.
3. The label might describe the product: who made it, where it
was made, when it was made, what it contains, how it is to be
used, and how to use it safely.
4. Finally, the labels promote the product through its attractive
graphics.
Labeling—Telling About the Product
Whether the label is a separate entity affixed to a package or is, in effect, the
package itself, it must perform certain tasks.
a. It carries the brand name and information concerning the contents of

the package, such as cooking instructions and information relating to
safe and proper use of the product.
i
b. A label may also carry instructions for the proper disposal of the
product and its package, or at least a plea to consumers to avoid
littering.
c. The label must contain any specific nutritional information, warnings,
or legal restrictions required by law.
Lesson 4: Product Life-cycle Marketing Strategies
A company’s differentiating and positioning strategy must change as the

product, market, and competitors change over time. Here we will describe the
concept of the product life cycle and the changes that are normally made as
the product passes through each stage of the life cycle.
To say that a product has a life cycle is to assert four things :
1. Products have a limited life.

2. Product sales pass through distinct stages, each posing different
challenges, opportunities, and problems to the seller.
3. Profits rise and fall at different stages of the product life cycle.
4. Products require different marketing, financial, manufacturing,
purchasing, and human resource strategies in each stage of their life
cycle.
Most product life-cycle curves are portrayed as bell-shaped . This curve is

typically divided into four stages: introduction, growth, maturity and decline.
1. Introduction: A period of slow sales growth as the product is

introduced in the market. Profits are nonexistent in this stage because
of the heavy expenses incurred with product introduction.
2. Growth: A period of rapid market acceptance and substantial profit
improvement.
i
3. Maturity: A period of a slowdown in sales growth because the product
has achieved acceptance by most potential buyers.
4. Profits stabilize or decline because of increased competition.
i
UNIT III
STRATEGIC MARKETING PLANNING
Strategic planning is the management task concerned with the growth

and future of a business enterprise. Strategic planning can be viewed as a
stream of decisions and actions that lead to effective strategies and which, in
turn, help the firm achieve its growth objectives. The process involves a
thorough self-appraisal by the corporation, including an appraisal of the
businesses it is engaged in and the environment in which it operates.
Lesson 1: Strategic Planning
Nature, Importance and Scope of Strategic Planning
The Orientations of Different Functional Areas
i
The Strategic Planning Process
 The strategic planning process has seven interrelated steps:

defining organizational mission, establishing strategic business units,
setting marketing objectives, performing situation analysis, developing
marketing strategy, implementing tactics, and monitoring results.
Because the process encompasses both strategic business planning
and strategic marketing planning it should be combination of senior
company executives and marketers.
 This process applies to small and large firms, consumer and industrial
firms, goods and services based firms, domestic and international
firms, and profit-oriented and nonprofit oriented institutions. Planning
at each step in the process may differ by type of firm, but using a
thorough strategic plan is beneficial for any company. The steps in
strategic planning are discussed in the following sections;
1. Organizational mission refers to a long-term commitment to
a type of business and a place in the market. It “describes the
scope of the firm and its dominant emphasis and values,” based
on that firm's history, current management preferences,
resources, and distinctive competences, and on environmental
factors.
• Examples of Mission Statements
i. Unilever: The mission of our company, as William
Hasketh Lever saw it, is to make cleanliness
commonplace, to lessen work for women, to foster
health and to contribute to personal attractiveness,
i
so that life may be more enjoyable for the people
who use our products.
ii. Merck: To preserve and improve human life.
iii. McKinsey & Co: To help business corporations
and governments to be more successful.
iv. Cadbury India: To attain leadership position in
the confectionery market and achieve a strong
national presence in the food drinks sector.
v. Tata Information Systems: To be India's most
successful and most respected IT company.
vi. Reliance Industries: To become a major player
in the global chemicals business and
simultaneously grow in other growth industries like
infrastructure.
2. Establishing Strategic Business Units

After defining its mission, a firm can form strategic business
units. Each strategic business unit (SBU) is a self-contained
division, product line or product department in an organization
with a specific market focus and a manager with complete
responsibility for integrating all functions into a strategy. An SBU
may include all products with the same physical features or
products bought for the same use by customers, depending on
the mission of the organization. Each SBU has these general
attributes:
i. A specific target market.
ii. Its own senior marketing executive.
iii. Control over its resources.
iv. Its own marketing strategy.
v. Clear-cut competitors.
vi. Distinct differential advantages.
3. Setting Marketing Objectives
A firm needs overall marketing objectives, as well as goals for
each SBU. Objectives are often described in both quantitative
terms (rupee sales, percentage profit growth, market share,
etc.) and qualitative terms (image, level of innovativeness,
industry leadership role, etc.) Small firms’ goals are often less
ambitious than those set by their larger counterparts, but they
are no less important. The goals are necessary to focus the firm
and to be able to monitor the level of success or failure. Without
Goals, how can a firm really measure its performance?
4. Performing Situation Analysis
i
In situation analysis, also known as SWOT analysis, an
organization identifies its internal strengths (S) and weaknesses
(W), as well as external opportunities (O) and threats (T).
Situation analysis seeks to answer: Where is a firm now? In
what direction is it headed? Answers are derived by recognizing
both company strengths and weaknesses relative to
competitors, studying the environment for opportunities and
threats, assessing the firm's ability to capitalize on opportunities
and to minimize or avoid threats, and anticipating competitor,'
responses to company strategies. To expound;
 Strengths are those positive internal attributes that

strengthen your business or team. You can develop plans
to capitalize on those strengths.
 Weaknesses are those negative internal attributes that
are working against your success. You can shore up
those weaknesses so they don’t stop your success.
 Opportunities are those external conditions that can
have a positive effect on your goals. These opportunities
can point you in the right direction.
 Threats are those external conditions that can have a
negative effect on your goals. These threats will affect
you less if you can identify and minimize them.
 Strength-Weakness Appraisal
i
We thought it would be helpful to show you a sample SWOT analysis for a
business you can easily visualize: a small independent bookstore in a
university town. The store owner brought the team together to think about
how the bookstore could survive during the continuing financial downturn.
After an hour of brainstorming, this is the SWOT analysis they developed.
5. Developing Marketing Strategy

 A marketing strategy outlines the way in which the
marketing mix is used to attract and satisfy the target
market(s) and achieved an organization's goals.
Marketing-mix decisions center on product distribution,
i
promotion, and price plans. A separate strategy is
necessary for each strategic business unit (SBU) in an
organization; these strategies must be coordinated.
 The Product/Market Opportunity Matrix
Let us discuss each part;

a. Market penetration is effective when the
market is growing or not yet saturated. A
firm seeks to expand the sales of its present
products in its present markets through
more intensive distribution, aggressive
promotion, and competitive pricing. Sales
are increased by attracting nonusers and
competitors' customers and raising the
usage rate among current customers.
b. Market development is effective when a
local or regional business looks to widen its
market, new market segments are
emerging due to changes in consumer life
styles and demographics, and innovative
uses are discovered for a mature product. A
firm seeks greater sales of present products
from new markets or new product uses. It
can enter new territories, appeal to
segments it is not yet satisfying, and
reposition existing items. New distribution
methods may be tried; promotion efforts
are more descriptive.
c. Product development is effective when an
SBU has a core of strong brands and a
sizable consumer following. A firm develops
new or modified products to appeal to
present markets. It stresses new models,
i
better quality, and other minor innovations
closely related to entrenched products—and
markets them to loyal customers.
Traditional distribution methods are used;
promotion stresses that the new product is
made by a well-established firm.
d. Diversification is used so a firm does not
become too dependent on one SBU or
product line. The firm becomes involved
with new products aimed at new markets.
These products may be new to the industry
or new only to the company. Distribution
and promotion orientations are both
different from those usually followed by the
firm.
Example:
Here is how the product/market opportunity matrix can be applied to United

Parcel Service—UPS
Market
Present New
Market penetration— UPS is the Market development— It is
world's largest package-delivery stepping up efforts around the
firm. It advertises extensively on TV world, where client use of delivery
and in magazines. The current services tends to be much less
slogan is “Moving at the Speed of than in the United States. In
Business.” It handles 1.8 million 1990, UPS International operated
Present customers through its automatic in 40 nations; now, it is in more
daily pickup service. than 200 countries and territories.
The firm's Web site is accessible in
15 languages and dialects, and
has dedicated content for 112
countries.
Product development— It now Diversification-
Product
While UPS'
offers more shipping choices than major focus is package delivery, it
ever before, including Best Flight also runs such subsidiaries as UPS
Same Day, Next Day Air Early A.M., Worldwide Logistics—which offers
Next Day (Air, Next Day), Air Saver, inventory management, facilities
2nd Day Air A.M., 2nd Day Air, 3 planning, site location, and other
Day Select, Ground Next Day Air, services; UPS Business
and Worldwide Express services. Communications Services,
New Ecommerce, quality measurement,
and telecommunications
consulting; and UPS professional
Services—a global management
consulting group that delivers
strategic business solutions
through innovative technologies,
financial analysis, and logistics
knowhow.
6. Implementing Tactical Plans
i
 A tactical plan specifies the short-run actions (tactics)
that a firm undertakes in implementing a given marketing
strategy. At this stage, a strategy is operationalized. A
tactical plan has three basic elements: specific tasks, a
time frame, and resource allocation .
a) The marketing mix (specific tasks) may range
from a combination of high quality, high service,
low distribution intensity, personal selling
emphasis, and above-average prices to a
combination of low quality, low service, high
distribution intensity, advertising emphasis, and
low prices.
b) Proper timing (time horizon) may mean being
the first to introduce a product, bringing out a
product when the market is most receptive, or
quickly reacting to a competitor's strategy to catch
it off guard. A firm must balance its desire to be
an industry leader with clear-cut competitive
advantages against its concern for the risk of
being innovative. Marketing opportunities exist for
limited periods of time, and the firm needs to act
accordingly.
c) Marketing investments (resource) are order
processing or order generating. Order processing
costs involve recording and handling orders, such
as order entry, computer data handling, and
merchandise handling. The goal is to minimize
those costs, subject to a given level of service.
Order-generating costs, such as advertising and
personal selling, produce revenues. Reducing them
may be harmful to sales and profits. A firm should
estimate sales at various levels of costs and for
various combinations of marketing functions.
Maximum profit rarely occurs at the lowest level of
expenditure on order generating costs.
7. Monitoring Results
 Monitoring results involves comparing the actual
performance of a firm, business unit, or product against
planned performance for a specified period. Actual
performance data are then fed back into the strategic
planning process. Budgets, timetables, sales and profit
i
statistics, cost analysis, and image studies are just some
measures that can be used to assess results.
 When actual performance lags, corrective action is
needed. For instance, “if implementation problems
persist, it is not (in most instances) because employees
mean to do the wrong thing. It is because they do not
know the right thing to do. The first task in making
strategy work is to identify the right behaviour—which
reduces costs, improves quality, pleases customers, and
adds to profits.”
Lesson 2: The Marketing Plan?
 A marketing manager must know “how to create a marketing plan or

how to write a good marketing plan“. Without knowledge about the
marketing plan, the marketing activities will just bring costs of the
company. A marketing plan is a part of the business plan .
 It is a detailed outline of marketing activities that are designed to
achieve the organizational marketing goals.
 Marketing plan consists of product and service description, target
customers, market demand, market gap, market growth and potential,
competitor analysis, segmentation strategy, targeting strategy,
positioning strategy, product strategy, price strategy, promotional
measures and strategy, distribution strategy, sales forecast,
promotional budgets and estimated market coverage plan with some
aggressive marketing tools relating to 4P (Product, Price, Place,
Promotion).
 Success and failure of a marketing plan depend on a customized
integration of these given tools and their appropriate implementations
 Why Marketing Plan Is Important?
o In this competitive business world, success and failure of a
business highly dependent upon its marketing activities. The
marketing plan is the core of any startup business plan.
 Steps of Marketing Plan/Marketing Plan format
 In a marketing plan executive summary is considered as the sandwich

of the marketing strategy and programs. It is a brief highlight of the
company product and service, target customers, market demand,
market gap, market growth and potential, competitor analysis,
segmentation strategy, targeting strategy, positioning strategy, product
strategy, price strategy, promotional measures and strategy,
distribution strategy, sales forecast, promotional budgets and
i
estimated market coverage plan with some aggressive marketing tools
relating to 4P (Product, Price, Place, Promotion).
Description of Product and Services

 A marketing plan should provide a detail description of their product
and service. What are the basic features of your product and service?
Why your product and services are different from your competitors?
Why customer will buy your product? What is the strength of your
product and service? An entrepreneur should think about their business
product on the eye of the customers and give emphasize on those
features that actually a customer desired from a product and services.
Target Customers
 Before going to design a real marketing plan it is very important to
define the target customer. Who will be the customer of your product
and services? In this section, an entrepreneur should provide a detail
description of their target customer’s age, income level, socioeconomic
conditions, test, and preference. Some of the cases it is important to
show the customer knowledge about company product and the
products offering by the competitors.
Competitor Analysis
 A competitor is any entity that directly or indirectly influences your
business decisions. An entrepreneur should analysis their competitor’s
strength and weakness on the basis of product quality, price,
advertising, goodwill, distribution capabilities, loyal customer base,
competitive advantages, upward and downward channel facilities.
Market Demand and Gap

 Determining the demand for a product or service is the key element of
consideration for an entrepreneur before going to start a business.
Demand for a product is generally determined by conducting market
and demand analysis of a product or service. Market and demand
analysis will enable the entrepreneur to identify an appropriate demand
for the product idea for his business. A structured marketing
plan should assess the total market demand in terms of market size,
the volume of the product, the value of the product . For an
entrepreneur, it is very important to identify the market gap by
assessing market demand and supply. Actually, a marketer takes
initiative to mitigate this identified gap, just because customers are not
satisfied.
2. Price Strategy: Cost Plus Method: Determining product price by adding all the
cost of production, promotion, distribution, and others relevant cost with the profit;
Compare to competitors’ price: Determining product price by comparing the
competitor’s price; Buying Capacity of the Customers: Determining product price by
considering the buyer’s capabilities. The marketer needs to determine that they sell
more products in low cost or charging the high price for limited numbers of the
i
product.
3. Promotion Strategy: The promotional strategy includes the decisions regarding

promotional tools (advertising, sales promotion, personal selling, digital marketing,
the point of sales promotion, outlet design) channel and media (TV, Social Media,
Online, Offline, Print) cost and market of coverage, time and frequency of
promotional campaign.
4. Distribution Strategy: A marketer should identify that they are making their
product highly convenient or exclusive. Whether, they use the dealer, distributor,
wholesaler, retailer or selling product by themselves, it should be mentioned.
Sales Forecast:
 A marketing plan should estimate their company sales for the next
three to five years. A marketer may use qualitative or quantitative
methods to forecast their sales. They may use their assumption from
their experience or use the statistical data to determine future sales of
their product.
Estimated Marketing Budget

 It is an important task to determine marketing budgets because
marketing budget provides a clear understanding of the cost of the
future promotional campaign. A good estimated marketing budget
should include the projected cost of transportations, promotional tools
(advertising, sales promotion, personal selling, sampling, online
marketing, digital marketing), communication on sales, outlet design,
commission to the marketing intermediaries (dealer, distributor,
wholesaler, retailer) and some others tasks that may generate cost for
any promotion.
References
Azam, G. How to write a good Marketing Plan? or How to create a Marketing

Plan?. Retrieved from https://startupaplan.com/how-to-write-a-
marketing-plan/
Fry, R. 2018. “Millennials Are Largest Generation in the U.S. Labor

Force.” Pew Research Center
i
Ward, S. 2020. Target Marketing and Market Segmentation.
https://www.thebalancesmb.com/target-marketing-2948355
“QSR 50, the.”2017. QSR Magazine
"Social Grade A, B, C1, C2, D, E - UK Geographics." 2014, UK Geographics
“U.S. Fast Food Industry Market Share.” Statista.
“Marketing myopia”. Retrieved from

http://www.businessdictionary.com/definition/marketing-myopia.html
“California Digital Library”. Retrieved from

https://cdlib.org/cdlinfo/2010/09/29/an-easy-way-to-jumpstart-your-
strategic-plan-swot/
i
SPAMAST - Marketing Management (EM 317) – AUGUST 2020 5

Marketing Management Module Revised

Uploaded by

Document Information

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Marketing Management Module Revised

Uploaded by

Copyright:

Available Formats

GLENN M.

SPAMAST STRATEGIC DIRECTIONS

A premier competitive institution of higher learning providing

a rich culture of academic excellence and integrity through innovative

1. Articulate and discuss the latest developments in the specific field of

Most of us define marketing as selling or advertising. It is true that

A product is anything that can be offered to a market to satisfy a want

Strategic planning is the management task concerned with the growth

INSTRUCTION TO THE USER

This module has intended learning objectives, pretest, discussion, and

DON’T BE AFRAID OF FAILING SCORE BECAUSE THE MOST IMPORTANT IS YOU

SPAMAST STRATEGIC DIRECTIONS …………………………………………… ii

Let us start the lesson 1!

Lesson 1: MARKET and MARKETING

1. Define markets and marketing

Time Frame: 1st to 3rd week of this semester

 According to Perreault and McCarthy, market is defined as a group of

 There are different types of markets which deals with products

1. Consumer Market: In this market the consumers obtain what

2. Industrial/Business Market: In this market, the industrial or

 Raw materials (iron ore, coke, crude oil etc.),

4. Global Market: The world is rapidly moving towards borderless

5. Non-profit Market: On one hand the society is making

So, what is Marketing?

Numerous definitions were offered for marketing by different authors. Some

1. Creation and delivery of a higher standard of living.

—William G. Zikmund and Michael d’Amico

3. Marketing is the process of discovering and translating consumer

4. Marketing is the business process by which products are matched with

5. Marketing consists of the performance of business activities that direct

—American Marketing Association

6. Marketing is a societal process by which individuals and groups obtain

—William D. Perreault and E. Jerome McCarthy

1. Applies to profit and non-profit organizations

5. Builds a relationship with the customer

1. Goods—Good is defined as something tangible that can be offered to

What does it mean?

a. A self centred company does not give any concern to the

 Marketing is a dynamic activity because a number of variables keep

 Long term objective of marketing is profit maximization through

 Marketing is an integrated function and all the marketing decisions are

 Marketing is the core functional area of modern day organizations and

 Marketing is interlinked with other functional areas of the organization .

 Marketing generates gainful employment opportunities both

 Marketing helps in stabilizing economic condition in the sense

 Marketing is the source of new ideas. New product or service

 Marketing provides direction for the future course. The

 Meeting the unmet needs or wants. Marketing identifies those

 Reducing the price of products or services . Marketing helps in

Core Concepts of Marketing

What does diagram tell all about?

Needs, Wants and Demands

 Needs describe basic human requirements . People need food, air,

These distinctions shed light on the frequent criticism that;

“Marketers create needs” or “marketers get people to buy things they

Example: Marketers might promote the idea that a Mercedes would

 A product is any offering that can satisfy a need or want . We

Value and Satisfaction

 The product or offering will be successful if it delivers value and

 The marketer can increase the value of the customer offering in

Exchange and Transactions

 Exchange, which is the core concept of marketing, involves obtaining a

From above discussion, we can define that;

Marketing Management is the process of planning and executing the